During the Obama Administration, when news outlets reported the monthly unemployment rate number, they hastened to add that it measured only those who were actively looking for jobs and had not found them. They then often went on to report that the unemployment rate had decreased because people had stopped looking for jobs. During the Trump Administration, they have gone back to reporting just the unemployment rate.
Trump Administration officials crow about the unemployment rate and about the number of jobs. What about the quality of those jobs: Do they pay a living wage? Are workers earning what they are worth? Have workplaces become less safe with all the abolition of regulations? What about the workers who are given erratic work schedules? These are issues that should be raised during the campaign.
335
@CH
How do you stop looking for work?
In my area and field, the number of applicants for open positions has dropped as more people have jobs with employers that are competing to attract and retain them.
7
So where’s the raises? I still know way too many working people struggling to survive. When are we going to get a share of this wonderful economy?
73
@Daphne You become discouraged. I know many men and women over 55 with brains and skills who cannot get a response to a job applications for love or money.
110
I am wondering how bad the coming recession will be. It seems the tariff war will show its true ugly face by next year and that combined with high corporate debt being sold as investment packages similar to the real estate debacle could exacerbate any usual slow down of the business cycle. Are we looking at a deeper recession than expected?
32
America has taken an incredibly long time to see the obvious built-in failures intrinsic in Trump and the "administration" which does nothing but recite ancient right-wing dogmas. (For example - Why is everything on Earth about tax cuts for the rich, etc.) It's likely to take a longer time to admit it was wrong and that voting for remarkably sleazy robber barons who think it's 1940 in 2016 was a big mistake. This farcical story will end, but there's a lot of mop and bucket work to come to undo the damage.
59
What total nonsense to say that the US economy is booming....sadly it is a ridiculous statement, or more correctly an outright lie.
19
The donald was always a clown jester, more or less. The fact that he surrounds himself with fools and nitwits is simply that he cannot stand anyone else in the room with more smarts, common sense or experience. Thus, we have the likes of Ron Vara charading as an economist. The war he picked with China was never thought out or with purpose as most everything else the muppet does. Fact: we cannot match cheap labor in any third world nation. Fact: as long as labor+shipping+inventory cost less manufacturing will never return. Fact: investment seeks profit. Fact: money has no loyalty. Fact: quit bothering china and invest in THE FUTURE: There is so much innovation to be had in the next 20 years, why worry about who is making the tennis shoes and toilet seats! Fact: ignore the moron, this marriage of ignorance with the American people will be forgotten in one quarter, or two bits, which happens his total worth to his name. If he’s out by Christmas we’ll be over it by Election Day!
16
Paul, you predicted the stockmarket would crash after Trump got elected. You are an economist, right? Have you ever said anything good about Trump? All of your columns are so negative on him. Crawl out of your silo. Stop beating a dead horse.
9
Just finished reading Crashed by Adam Tooze. While I didn't understand all the economic ins and outs, I do understand we live in an interrelated world, and our national interests must match those of our allies. Now they don't. Saying that Trump and his team are very strange people is a vast understatement. They are crazy and no one is sure where their loyalties lie. Personally, I believe Trump listens to Putin only and does what he says. I can tell when he has done something really stupid and has to use Putin's arguments to justify them. His mouth is dry and he carefully reads his script, which contains lies and overblown nonsense. My sense is that economically Trump (Putin) will continue subtly trying to undercut our economy and that trade wars and tax giveaways that suck treasure out of the economy are the main weapons. Trump voters have no skin in the game and don't care. Their hate will carry them through. Republican leadership is coming across as a bunch of lost puppets.
13
Interesting. Immediately upon Trump's election victory Mr. Krugman was predicting the imminent collapse of the economy. Remember these words back in 2016?.."So we are very probably looking at a global recession, with no end in sight. I suppose we could get lucky somehow. But on economics, as on everything else, a terrible thing has just happened."
Let me see, who said that?
And then in 2017–" There Will Be No Return to 3% Growth"
Then in 2018...A Recession is Coming!
In February 2018 .. a recession is coming “this year or next.”
Now it's: "And overall growth, while still positive, is definitely slowing"
I guess even a Nobel laureate can screw up once in a while, but if you keep predicting it, someday it is bound to come true.
Keep at it Paul. As they say, "even a blind pig..."
10
This is a deplorable thing to say, but it's all I got--and I will say it one word: Good! The lower business confidence goes, the more businesses tighten their belts--indeed, sooner economic growth dips below 2%--the sooner the average American will wake up and start screaming bloody murder; and it can't happen to soon.
Who's (or what's) being murdered? Our democracy, our ability to maintain strong relationships with other countries (except Turkey, I guess), our trust in basic fairness and in the law, and, I would suggest, our kids' futures (not that we really care about that, I know).
Sadly, there is zero possibility that the wake up call needed will be heard and acted upon without a loud, economic alarm. But when that alarm goes off, and it will--watch out! All hell will break loose, and it's be about time!
12
From the time Obama was elected the Republican party made it their mission to destroy any record of the man's Presidency. They have rolled back numerous pieces of legislation and have used the previous administration for current issues as their justification for their scorch earth policies. It will be the imbeddrd racism that has existed since before slavery that will undermine all the good and any chance for recovery. And the bigots did it to themselves and the rest of us. Their hatred is that all encompassing.
15
Non-farm employment is lower than it was when Trump took office. Low unemployment is mainly demographic.
https://www.bls.gov/web/empsit/ceshighlights.pdf
1
It's been a record run going back to Obama. It had to end sometime. It's narural. I will take 9 years of gains for a recession 100x in a row if we could.
1
The Trump boom died the minute he took the oath of office.
6
So why is the yield curve uninverting?
1
When Zelensky states there was no quod pro quo or pressure, are Democrats insinuating he is telling a lie?
1
Mexico is in recession and crime is rampant. Canada is on the cusp of a recession while Pelosi sits on the USMCA. Let’s ask her what happened?
5
Because Trump is the quintessential flim-flam man. He has glided through life on someone else's labor and laurels, knows about 10 key buzz words and hasn't worked an honest day in his life. He talks a big talk and lets his gilded smoke and mirrors show do the rest. He's a snake oil salesman selling poor saps a dream they'll never have. People claim he knows how to deal, but ALL of his books were ghostwritten, his 'reality' show was about as 'real' as a flying pig, and if anyone is foolish enough to think that Trump won that presidential election, then they are either dumber than rocks or in cahoots with the crook. Trump is a clueless charlatan who is being used by a much smarter leader as a puppet to divide our country so the USA becomes weak. It's working. Wake up Americans. Time to see through Trump's golden smoke.
15
Remember folks, sure the economy is “good” depending on if you look at only certain metrics, but let us not for get that the deficit this year is approximately one trillion dollars and only growing.
Tea Partiers should be out in the streets like crazy, but alas, no...it was never really about fiscal responsibility (which by comparison the deficit went considerably DOWN during Obama’s terms), it was really about a black guy. You know how I know this is true? Because everything you accused Obama of is blatantly in your face with Trump and you refuse to acknowledge it.
You have sacrificed all that is good in America on the altar of a thrice divorced, six time bankrupt, loudmouth, know-nothing, narcissistic, predatory, Dunning-Kruger in a cheap suit. The whole world has seen Donald Trump’s version of loyalty and it is a one way street. If you think he cares about you, you’re not deplorable, just gullible.
21
Trump is the head of a mafia family and they are out to enrich themselves any way they can.
He will move heaven and earth to keep the economy stable until the election is over. After that all bets are off.
8
Agh evil "bloom" we know this well. Yeah Wm S Yeats et al - & OT shenanigans!
Mr T obviously has no idea about economic policy, but then nor did most other presidents in history. Generally speaking this has never been a big problem, as long as nobody noticed. But the insane pronouncements made by the President's office have made it difficult to overlook the top-down stupidity of this administration's policy. Economists have long since stopped seeing imports exclusively as a danger to the nation.
2
Krugman may like to keep the photo of a trader taking a break outside the NYSE on a day that the Dow Jones Industrial Average closed 1% lower, but on the day this piece was published, that Average reached a new all-time high. Soon!
4
Don't be so sure Mr. Krugman. The collection of Democrats running for office in 2020 seems to be more fixated on telling people about what freebies they can further grow our mounting deficit on. Or bickering over trivialities. Unless a white horse candidate, someone like a Mike Bloomberg throws his hat in the ring, I don't believe we can count President Insano out in 2020.
1
No one in the existing business world is going to invest in America as the wages are almost in line with survival and family health care is beyond the means of many full time employees and only available to the less employed at the emergency room.
Neither party has the working class in mind as they are all standing in line for their share of the off shoring payoff. Mr Reagan started it and, horror of horrors, our esteemed Mr Clinton kept the ball rolling. How else do they reline the pockets of their largest contributors?
3
A good article. I was surprised just yesterday when a very good and very conservative friend of mine said almost exactly what Krugman said in this article, ie, "I am afraid Trump doesn't know what he is doing". Of all the unkind words a man does not want to hear, the most unkind, and in this case spot on, is incompetent.
5
The Republican Party respects none of the procedural rules of governance that preserve open debate, tolerates compromise between the parties, and assures to the temporary minority party deliberative rights in the legislative process.
Moreover, they no longer respect constitutional guardrails that prevent abuse of power by the majority In power.
Even so, the nation might muddle through were it not for the Republican Party’s devotion to gerrymandering, manipulating census data to fraudulently create falsely low census counts in Democratic Blue states, and multiple attempts by Red State maneuvers to disenfranchise minority citizens.
If the President alone were guilty of these high crimes against the Republic , he would deserve impeachment and conviction. When a party is guilty, its members cannot be impeached. As happened with the American Communist Party after 1946, such a party can only be declared an illegal arm of a destructive faction that represents an existential threat to democratic republican government and be delegitimized.
The Democrats are wrestling a rogue alligator and must not play by the alligator’s rules. In s doing so, the simply become a new alligator.
If the Democratic Party cannot persuade the courts and the American electorate of the crimes Republicans have committed to subvert constitutional government and to preserve minoritarian rule in their own hands, this Republic is doomed.
4
When will Mueller testify in the impeachment hearings?
There is no reason for the Senators to speak out against Trump now because that would only give the lunatic the megaphone .
Senate republicans know Trump will not win the election and all of Congress are very concerned with how much damage/ danger Trump will do between the landslide election lost and inauguration day 2021.
Senators understand it is simply much smarter to wait for the Senate trial and send The Criminal Con Man in Chief on his way to prison in one fell swoop.
The New York State Attorney General will be waiting with open arms of justice.
4
"Did anyone foresee Wednesday’s physical attempt to disrupt the House inquiry?"
Did anyone recall Republicans physical attempt to shut down the recount to put GW Bush into Office? It worked then.
4
"The Day the Trump Boom Died"
Paul, please get out of the habit of attributing any economy, good or bad, to a president. When the economy was better did you ever call it the "Trump Boom"? Also recognize that Congress has abdicated their constitutional power to raise revenue to the executive branch. It should not be up to the president, regardless of party affiliation, to change tariff rates without legislation.
"Everyone is following the impeachment story, and I don’t have much to add, except a warning: At every stage of this process, Republicans have proved willing to engage in stunningly bad behavior."
Please provide details on the "stunningly bad behavior", Paul; you have plenty of space to do so. Do you consider the process Democrats are conducting impeachment proceedings? Do you think this process should be done by one party behind closed doors and place restrictions on the other party? How is that not considered "stunningly bad behavior"?
"Next year’s election should be about Trump’s betrayal of his oath of office. Realistically, however, it also matters that the economy probably won’t be his friend."
Paul, can you tell your audience what actions by Trump constitute a betrayal of his oath of office? Please be very specific.
Submitted 10/24/19 @ 7:48 p.m.
2
I thought Ron Vara and John Barron ran a consultancy together. “Fraud Guaranteed,” or similar. /s
4
“... it’s not reassuring to learn that his trade war czar , Peter Navarro, has an imaginary friend- a source named ‘Ron Vara’ whom he has repeatedly cited in his books, but doesn’t exist and whose name in fact is just an anagram of ‘Navarro.’”
Perhaps Navarro got that idea from his boss, who in the past used various names like “John Barron” to pretend to be a publicist calling people up to brag about Trump’s achievements and inflate his net worth. Hard for American business to have confidence in a “pretend” president being given economic advice by “pretend” economist Navarro and his imaginary friend. The economic challenges facing this country could not be more pressing or “real.”
3
Sorry, it's the Fed
Any cheap credit fueled bubble must come to an end
The current expansion was the longest in history fueled by free money.
Current yield of US 10 year treasury bill
1.77 %
Year to Year inflation
1.7 %
Real (nominal rate minus inflation) interest rate : ZERO
Alas, the credit worthy (aka the rich ) could get their hands on free money.
Capitalism was founded on the assumption that credit is a priced resource handed out in a competitive market place to those best able to use it.
Free money destroys it.
Incredibly, Krugman endorsed this policy that punishes savers, and destroys Pension Plans , including Social Security that by law must invest in US T bills - and increased inequality between those who could get their hands at free money and those who could not (the non credit worthy)
"And there is correspondingly a case for partially reversing recent Fed rate hikes, and cutting rates now as insurance against a possible future slump — getting ahead of the curve. Donald Trump is the worst possible person to be making this argument, but that doesn’t mean that the argument is wrong."
Paul Krugman , NY Times June 20, 2019
EVERY bubble in financial history was fueled by cheap credit. This one too, had to end
Recommended read. Krugman
"Running out of bubbles"
https://www.nytimes.com/2005/05/27/opinion/running-out-of-bubbles.html
He got that one right, except he underestimate the Fed!
It invented QE
Yes on all points, Mr Krugman. What if there is another explanation for Trump's economic decisions. Let's pull back to the big picture and ask ourselves why the tax cut and tariffs? What if every economic decision (probably every decision for that matter) is done for what is most ideal for the Trump corporation(Trump himself) and the Trump family and his closely-held loyalists? He perceives himself as all-knowing and all-wise. He ignores the thoughts and feelings of others as well any feedback or perception of any of his acts that would be construed as losing, weak or negative. Even though a megalomaniac, he portrays himself as a victim to curry the favor of those he has conned, his toadies and cronies. He mentally frames every human interaction as a battle to be won and lost, hence calling it a trade war and easy to win. "All is fair in love and war," is his immoral maxim. Viewing himself as the center of the universe and an unbeatable warrior, he sees others misfortunes as collateral damage and 'losers'. He evades by giving farmer's handouts and blaming the Chinese. He keeps these self-centered views to himself, and spins lies and untruths endlessly to psychologically manipulate people to believe in his reality and bend to his will. What other famous leaders had these warped perceptions and did concomitant actions:Hitler; Mussolini, Stalin; Lenin;Napoleon; Franco: Mao and so on. This man has no economic policy, just a pathological desire to conquer everyone in the world.
1
Trump is a master of distraction, and it’s so sad to see how easily the democrats and liberals fall for it every time. Why don’t they get it by now? The republicans certainly do, and they have used this to their advantage against outraged reactionaries, political opponents, and media pundits who feel they must answer to each and every idiotic statement that comes out of Trump’s mouth. His latest statement about how the impeachment inquiry to a lynching just is the obvious latest example. By deliberately throwing out poisonous and inflammatory words, he has distracted the public’s attention away from the basis and reasons for the inquiry itself, thereby changing the narrative from the web of corruption and abuse of power in his family and associates to his racism. This is no accident. I also believe that his pulling the troops out of Syria is another attempt to distract the public from the impeachment inquiry and his personal scandals. By now it should be clear that there is no treet too vile and no move too insane for Trump, but this has actually worked in his favor, crazy as that is. Is it any wonder that people are really not paying close attention to the economy and the environment? It takes a while for those two things, which by the way are inextricably linked, to implode, but if you don’t think they are imploding, think again.
2
All true and scary for all of us. Charles Barkley, a former Republican, said one time that he left the GOP because "they have gone crazy". The GOP, in fact, no longer exists. Now we have a party of Trumps and Gaetz's. Loud, ignorant, and corrupt.
Cause, the 'dumbing' down of America that began seriously in the Reagan administration. Intelligence, science, facts, and truth out the window in favor of what is now a Murdoch driven tabloid culture. Trump and his regime drive daily attacks on the US Constitution culminating in a trashy display of so called Republican House reps attacking legal impeachment hearings.
Someone suggested cancelling Murdoch's citizenship. While he plays a big part in trashing our democracy, there are many others who are treasonous enough to lose their's as well.
What is the solution? Massive demonstrations and voting by all of us.
3
When would Trumpers like the Trump recession to start? If it’s under a Democratic President after January, 2021, I’ll take it.
3
The fact that people check their bank balance before deciding if Trump gets their vote absolutely astounds me.
7
@Farfel They were probably gung ho for Clinton’s impeachment.
I think there was never really a Trump economic boom, but just the residual results of sound decisions made by the Obama administration coming home to roost. Then Trump took credit for it and fooled a lot of folks into thinking the good economy had anything to do with decisions made by him and his administration.
It took a few of their bad decisions, made by this current bunch, to slowly bring an end the more thoughtful and measured approach of Obama, and now we are beginning to see and feel the negative effects this bunch has wrought. And it will only get worse as those bad decisions continue to play out.
So as has been the case over past 30 or more years, the Republicans make a mess of things when they are in office, drive us into deep deficits and cut strategic spending that helps spur the economy; then the Democrats have to come in once more to clean things up and stabilize the economy.
It is time for a big structural change, and let's hope it's led by Warren and her progressive ideas.
15
The basic fact is if we didn't have a deficit in the range of 5% of GDP, we'd be in recession right now.
When we realize how much the economy has been built on smoke and mirrors, we may long for these days of "uncertainty".
Because sometimes you are certain that you are entirely in the wrong place at the wrong time, you are correct, but deep in trouble.
4
What is it with these imaninay people invented by people like Trump and Navarro?
Trump used the pseudonym "John Barron" In the 1980s and in 1990 and used him to sing is own praises.
Peter Navarro invents a source, "Ron Vara," to give more weight to his own ideas.
I guess if no one agrees with you, you just make someone up to solve the problem and as a way to try to win arguments.
It is like the old saying about the person who can't win fair and square so they play dirty, because to them,"winning" (although that word under these circumstances is debatable) is all that matters.
Is it any wonder that we are where we are in this country right now when the people running the place have no real integrity or values at all?
11
Could it be that Dr. Krugman now believes in the Confidence Fairy?
1
If the desperate moves Trump offered up prior to the 2018 midterms offer any insight, we can be pretty certain that Trump will dangle a possible middle class tax cut, and a host of other promises "if re-elected". That didn't work for him in 2018, because 2 years of his constant deceit was enough of a lesson for too many. That lesson should be reinforced, and should hold for 2020.
11
What happened to confidence?
The bump was never truly confidence—it was at least equal parts speculative zeal and opportunism. And how did the GOP suddenly forget the debt? Mercenary opportunism.
If our economy is only strong when people are willing to take big risks in order to reap big profits, we’re in trouble in the long run. We should avoid turning into a nation of speculators, middle-men and debt-servicers.
Somewhere we lost sight of the meaning of ‘killing’ when we embraced an ethos of everyone trying to make a killing.
3
America's total debt to GDP will go above WWII levels at a time when aging Americans will be dependent on social security and medicare benefits. America is a superpower in decline.
18
The G.O.P. has tried to sell itself as the pro-business party. Sure, the business community generally favors lower taxes and deregulation.
But as Dr. Krugman points out, the business community also needs certainty. They want a predictable policy environment in order to make long-term plans and investments. Mr. Trump, by contrast, offers chaos and uncertainty.
The Trump Republican Party, and their policies of anarchy and unpredictability, are anathema to business.
So much for the idea of having a so-called "businessman" in the White House.
9
Good column. Good points. How about a few more: This economic/business cycle has (more than) run its course. Debt by business is sky high; government debt and consumer debt are high, so borrowing is becoming constrained and impacting spending/expansion. Businesses, landlords, profit-making organizations have squeezed the last drops out of labor, consumers and business customers (that's why rents have started to fall in places like NYC). The punch bowl is empty and it's past time to see the party end.
3
To Paul and his economists cohort: Please volunteer your time and effort to help Democratic candidates in up-coming elections at all levels with bullet points and punch-lines and anecdotes and great stories to help those candidates explain just how awfully bad Trump and the rest of the Republicans have handled economic policy? You all can get together to package the actual data in a form useful to candidates and to make sure it is delivered. Counter Trump's lies all over the country! When Trump says "Manufacturing is going great!" Many will believe him and Fox News will support him. You and I know that isn't true but Dem. candidates need the ammo to argue against it. Give them the ammo. You have the knowledge and the power and the organization to do so. Please get active at all levels. Then you may add "the Glory".
11
"Trump and his team are very strange people who have no idea what they’re doing." That may not "say it all," but it's pretty close.
13
Raise taxes on the wealthy and the corporations to at least 39 percent rate.
That will solve two problems: More money for the treasury for infrastructure (which will add jobs), and less money for the wealthy to spend on elections.
Repeal Citizens United - another way of saying Oligarchs United.
20
It is hard to grow the economy already at full employment. It really doesn't matter because things seem to be on their way down on their own. Businesses need confidence in order to make capital investments. Currently, there is uncertainty everywhere one looks. Trade, political, constitutional and institutional. Any of these on their own causes pause. In combination, they cause paralysis. If nothing else, a year from now the election will be behind us. In the meantime, much of the uncertainty could be eliminated if Washington really does put America, and not themselves, first.
9
While my investments are doing well right now, I have held a considerable percentage in cash and equivalents. From the beginning of the Trump administration, I have expected a recession. Tax cuts staved it off once. Federal reserve interest rate cuts have held it off recently. Yet sooner or later, Trump's non-system of finance will fail.
11
@Barbara
Trump was good for short term profits, like shutting down R&D would be good for short term profits. Not so good for the long term, though.
10
Trump likes to refer to official statistics when they favor him, like record highs on the DJIA and record lows in official unemployment figures--figures he derided as grossly misleading under Obama.
He only accepts the results "if I win". This is how he's done business for decades. Anybody expecting honest assessments from him by now really, *really* needs to reconsider.
6
It is just so maddening tp think that the "captains of industry" that went along with Trump et al bought their baloney. Why would people with such money and power not have stood up to this guy?
This is all so disheartening.
8
I’d live in a box under a bridge if the economy collapsed if that’s what it takes to get this train wreck of a human bring out of the White House.
6
It took a business man at the helm to bring out the unacknowledged rabid consciousness in this country.
4
It's distressing to me that many people look at the economy for guidance in their voting. The economy rises and falls for many reasons but those reasons are not ethical or moral, they are simply part of economic facts. People should vote on the basis of whether a candidate will enforce what is good in society and according to our founding documents -- not whether he gets a few more shekels in his pay check next week. But I realize I am being an elitist who has no financial concerns. That is what is wrong with democracy. It empowers people who have no guide but their selfish interests. At least some aristocrats could find other ways of judging what is good or bad. We are a Republic not a Democracy. I know right wingers say this all the time but what they mean is not what I mean. I view Republics as government ruled by virtue; they view Republics as government rule by greed. Voila la difference. I don't know where Comrade Krugman stands on this, probably not where I stand or sit.
3
Krugman overlooks the fact that Trump has never admitted to losing the popular vote. According to the current president, there were millions of illegal voters in California, all voting for his oponent, which implies that he or people working for him looked over the shouders of millions of voters (illegally) to see who they were voting for.
6
Half the country (or more) has been brain-washed by FOX Noise for the last 25-30 years, so comparisons with the Ronald Reagan era are not so applicable. Republicans have demonstrated nothing but tremendous disdain for facts ever since President Obama was first elected - facts are not conducive to their narrative, and are completely at odds with their ideology - so they will still vote for Trump in 2020. And while a few of them are pretending to be concerned about Trump's behavior, they will never move to impeach him.
9
They voted for a guy who they knew had bankrupted six times, including going broke running a casino — how does one do that? They voted for a guy who openly bragged about stiffing contractors and workers.
Somehow, I don’t think an economic message is gonna make a dent.
His voters didn’t vote for him on economics; they loooved the bigotry, misogyny, xenophobia, racism, anti-education message. They loved the opportunity to be angry in a crowd.
17
"Everyone is following the impeachment story..."
I'm sure almost everyone Paul Krugman knows is "following the impeachment story." But there is a large slice of the American electorate that is probably mostly ignoring the story and what attention they do pay to it is in denial that their president has done anything wrong.
My neighbor has stated emphatically that he will not watch, hear, or read anything negative about Trump. I fear he is not an anomaly today.
9
@Ellis6
"My neighbor has stated emphatically that he will not watch, hear, or read anything negative about Trump."
See no evil. Hear no evil. Speak no evil. (Of Trump.)
Heads in the sand. None are as blind as those who refuse to see.
We can only hope that 20 Republican Senators will extract their heads from the sand, and put country over party.
2
Whom do we want in office when Trump’s recession hits? On the other hand, when was the last time Republicans got the opportunity to clean up their own mess?
6
For 8 years business interests complained about uncertainty under the Obama administration.
I am appalled at the hypocrisy when the same business interests continue praising the most erratic administration in US history.
The Chickens have come home to roost.
"Business interests spent a long time in denial, but now even they are facing up to the reality that Trump and his team are very strange people who have no idea what they’re doing — and the uncertainty that reality implies."
4
@kckrause
When I’m expected to pay $1600 a month for healthcare costs, I’m not sure any of them know what they are doing. And, I would like the names of every politician who has enriched him or herself on healthcare industry money!
7
Obamacare was supposed to save you and the government money. I’m glad that I am on Medicare and only pay about $500 a month for Medicare part B and supplemental insurance coverage.
1
"Why has business confidence collapsed?"
I think the real question is: why it took the business community so long to wise up- or, maybe even, why in the first place did they ever believe that a failed real estate/reality TV performer/political gadfly could sustain an effort the magnitude of Obama's economic recovery?
Let alone- expand it?
There has to have been a kind of collective insanity in the business world about this, perfectly exemplified in Professor Krugman's exegesis of it.
Nothing in the tax cuts, the rejection of the TPP (and the Iran and Paris Agreements), the tariffs, or the healthcare scam were good- for the Obama recovery economy. They were insane. I'm not an economist, but it doesn't seem difficult to recall Obama's actions to combat the recession.
Did they just miss the fact that it was an "Obama recovery" to begin with, because they didn't want to see the truth?
There's nothing left to learn here, Professor.
There's no logic to their position.
It's just prejudice and stupidity.
7
We should ask the NY Times and CNBC to do an in-depth interview with "Ron Vara," since his opinions are so influential and trusted by Navarro and Trump.
7
I wonder how many NYT readers understand the viewpoint of Trump supporters? As communicated via broadcasters like Limbaugh or Hannity, the 'secret' impeachment hearings going on - with an outward appearance of lacking transparency and short circuiting the ability of the 'defense' to hear testimony, the current impeachment exercise is an effort to defame / diminish / destroy DJT's chances of winning since ( so the thinking goes) the Democratic field is weak (far left) and has little chance of beating him without a dirty take down. This 'silent coup' effort affects the economy. So does the deficit spending .. it is an economic sugar rush. What do you think the growth rate & unemployment rates would look like if govt. wasn't spending or doling out an extra $1 trillion per annum now?
2
@The Errant Economist You've been listening quite closely to the talking heads at Fox as you criticize a very legitimate impeachment process. Claiming DJT's behavior regarding Ukrainian extortion is a "silent coup" by Dems is just typical 2019 Trump deception. Don't know what to think of Trump's behavior? Watch Fox and learn what to say. Call it a smear campaign against a brilliant man and the U.S. constitution.
I've often thought that among the most embarrassed Americans by the Trump presidency are those at the University of Pennsylvania who granted him an undergraduate degree in economics.
15
You have to give Trump credit for staying true to form. He was handed a booming economy and then proceeded to say it was all his doing and no one else's. Then he proceeded to do his best to destroy it through his petulant foolish actions. If you can bankrupt a casino you can bankrupt anything I guess. I just hope we have enough people who stand for the Constitution to vote and throw Trump and GOP out with the trash.
16
Trying to be optimistic, I suggest an alternativer vision. How about if the Repubs nominate Mitt Romney. They did once before and he proved his conservative credentials and performed presidentially. (I voted for Obama.) With Romney as candidate, conservatives will get everything they like that Trump has done but none of the disgrace. They will get the promise of: less regulation, lower taxes, conservative judicial appointments, but without trade wars and tarrifs. At the same time Romney will not declare the press the enemy of the people, he will not lie every five minutes, he will foreswear twitter, he will not mimic reporters with disabilities, he will not grasp women's privates, he will not use the office to burnish his "brand," he will not name utter incompetents to his cabinet, he will not quarrel with the president of the Federal Reserve, he will not bribe foreign leaders to help him get reelected, he will not cozy up to fellow dictators, he will disclose his tax returns, he will accept a blind trust, he will act constitutionally, he will offer voters a genuine choice. In sum, no matter how much we may disagree with his policies, he will embody the virtues of a public servant and he won't be Trump.
106
@lhc
The problem is that "less regulation, lower taxes, conservative judicial appointments" will not be good for our country in the long run.
35
@lhc
and he won't get votes
9
@lhc
"How about if the Repubs nominate Mitt Romney."
Go for it!
10
I was on faculty at academic medical center for 21 years, then at the NIH for another 10 yrs before ending my career in patient advocacy. Published over 100 peer-reviewed research articles and book chapters. The 'code of honor' for academics is that your integrity is everything and if it's lost, you're nothing.
Navaro has just admired that he has no integrity, no credibility. Not that I'm surprised by the lack of integrity, but it's stunning that he admits this given how he was immersed in academic culture for years.
Is there anyone in the administration, or in the GOP for that matter, with even a scintilla of integrity remaining? I think not--it just wouldn't be in their "character."
80
@porterjo
Navarro might very well believe that the Chinese pay the tariffs imposed upon them by the US, just like his uninformed boss. We, of course, know better - they're being paid for by the forgotten American consumer. Navarro not only lacks integrity, he lacks intelligence.
9
Great column! I was shocked to find out the 'trade czar' has a nom de plume "Ron Vara" which is an anagram of his last name! Corrupt and dishonest - sounds like a Trump appointee. When Trump was running for office, many of his supporters cited his business acumen as a reason to vote for him..."he'll run D.C. like a business!" First of all, that never works because business and government have different motivations. But moreso, they failed to accept that he inherited most of his money and that his businesses have failed many times - including the casino in Atlantic City. A license to print money...a casino, and he failed! I feel like our country is the casino - he overspends and angers everyone associated with it to the point where now the Taj Mahal is an empty shell. I don't think America will implode, but this man cannot be re-elected otherwise we will be desolate place ripe for the Chinese to clean us out completely. And Dr. Krugman, I do think the deficit matters - it is an indicator of our values.
Look at all the debt Americans are in - no jobs or dinky raises are going to pay those off anytime soon. It keeps getting worse, just to maintain a middle class lifestyle. Just looking at low unemployment numbers isn't enough. We should count the debt carried by employed Americans and the national debt as a negative economic indicators and incorporate them in the data. Stop using 20th century data collection and analysis on 21st century problems.
4
The outcome of the next election may well be decided by how poorly Trump has managed to fulfill his promises to rust belt factory workers. There was this big rush of excitement that he'd be bringing back factory jobs to all those towns. Then, it transpired, his plan for doing this was to Tweet shame companies that tried to downsize or move their factories. This may have resulted in some temporary reprieves, but no fool would expect that strategy to produce a growth in factory jobs or a resurgence of manufacturing in the US. Toss in the trade war and it quickly became apparent that Trump has no plan for achieving his promises.
As a result, Trump may be in deep trouble with factory workers, but I wouldn't discount him entirely yet. Democrats need to provide a concrete, achievable set of proposals to boost jobs in this part of the country. So far, I don't think any of the leading presidential candidates out there has done this. If they fail to do so, it'll be a gigantic missed opportunity.
2
@Mr. Adams How about proposing ending job-killing trade wars?
2
You would chose China to turn the US into their next Hong Kong? We have to remove China’s power over us. Unfortunately, Trump isn’t doing it the best way, ::obviously:: but at least he knows it must be done.
Last night I watched "Goldfinger", a 55-year-old Bond movie. The villain, Auric Goldfinger, was a fat rich, red-haired greedy old criminal who cheated at cards and never worked a day in his life. He set out to ruin the world economy because there was profit for him in it.
In 1965, this was entertaining. Somehow I don't find the movie as enjoyable today.
10
Lincoln had it right, "You can fool all he people some of the time, and some of the people all of the time, but you can't fool all the people all of the time."
Not wishing to offend Lincoln who was a Republican, but I would add, Trump can fool all of the Republicans all of the time.
2
Democrats don't understand that hoping to crash the plane on which they are passengers and Trump is the pilot is a mistake. There is no recession but they are trying to force it to happen. Trump has given us the lowest unemployment in the history of the USA. He gave us the highest stock market in the history of the USA. He gave us the highest consumer confidence, is rebuilding the miltiary Obama destroyed, rebuilding international relationships, bringing the troops home. Dems can't win in 2020 unless one of the dozen hoaxes they throw up stay in play. The recession is just one of them. Obamacare was cancer for business. The USA is back!
5
@Joey Ford Reporting from Jonestown, Guyana.
Delusion is not the mother of all invention, unless, of course, you're Donald J Trump and his obedient followers. You just repeat the most shallow talking points you heard on Fox or Limbaugh without giving any thought or analysis to what you're hearing. Had you been in Guyana back in 1978 you would have red lips. Sorry to say.
2
I look at my 401k and have no complaints.
5
@Jerry Davenport Same here except I have plenty of complaints.
3
How about your conscience?
Trump is the opposite of Midas. Everything he touches crumbles to dust. He destroys every person foolish enough to mistake him for being a business leader, and crashes with every idea that he pursues. Once his policies take root and he is done with the economy, it will collapse like Trump University, the Taj Mahal casino, et al.
None of us wants recession (and especially a depression) anymore than we want to witness a head on collision, but we are perched with a view of an economic collapse that we know we can't stop. But the frightening question is, Will the inevitable happen in time? If the economy does fail, will it happen before the election?
One need only have a Facebook account with plenty of right wing friends to know that Trump is coasting on the economic upswing created by Obama. Republicans take Fox News for gospel, in which the network has created for them the same satisfying environment for adults that a playland's giant ball pit is for children. In other words, an environment where the rest of the world and its realities disappears. Fox has them convinced the economy flailed until the day after Trump took office.
If those economic trains don't collide until we elect a Democrat, there will be a generation's worth of damage done to a party that has already lost its grip on its relationship with working people.
I am not wishing for a recession, but if it's on the way, then I hope it gets here before ballot time.
2
October 25, 2019
Surely, the business of America is business as the saying goes.
But how our minds go is more about electronics indicators to instant knowledge to winners or losers. This is Trump madness age and not invented or designed by his politics'; as all is universal to the mechanics of how vital activities are idolized in the matrix on line grid of transaction commerce and everything else in matters of politics, economics and individuation for self worth. What is dead is the talent to define the two parties systems has can give its design towards policies understood by all in electorate - since the main target of success is ones social on line worth and let the economic theories be of the past and for now and future its all about cyber salvation magnetism one person's web worth.
1
Perhaps the real reason Trump has elected to start a trade war with China is not to make those dealings more equitable but rather to enable him to impose tariffs on U.S. consumers and businesses.
He seems to have discovered a way to raise $10s or $100s of billion in funds from us without need for going through the legislative process needed to pass new taxes.
Trump can then take the money and allocate some of it (as little as possible) to shore up political support of farmers and such but pass most of it on directly or indirectly to his own ventures.
Given his nature and record, this is a perfect extension of his conman skill set.
3
While I agree with you that Trump has and always will overplay how strong the economy is under his watch and how much more terrific he will make it if he gets reelected, there are 2 major obstacles to him being defeated based on the economy.
First, there's at least 40% of the country who will vote for him no matter what, even if he "shoots someone in the middle of 5th Avenue". In their eyes he can do no wrong and they love his pompousness and constant bullying.
Second, most of the Democrats do not have an economic plan that appeals to most of the people in the middle they need to swing their way, Free healthcare, free college, reparations, to name a few all cost money. A lot of money. The Democratic contenders all seem to want to out free each other which is by no means appealing to moderate voters like me.
As with 2016 we are going to be faced with choosing the lesser of 2 evils instead of really being able to get behind a candidate we want to vote for.
6
Under Trump the U.S. deficit has hit $984 billion. Republicans have no problem with this. Democrats will not have a problem with what you term as "free" in 2020.
6
It's not the same to be a ruthless businessman who prefers to make a fast buck, leaves suppliers hanging and moves on to the next scheme than to be a statesman that protects future generations by being reliable and trustworthy.
5
Paul, I'm afraid "Drumpf and his team are very strange people who have no idea what they’re doing" is a far more generous reading than they deserve.
Drumpf has made his friends *billions* of dollars by moving markets with his trade war. Our farmers are suffering while he lines his friends' pockets.
"Federal regulators might start here: In the last 10 minutes of trading on Friday, August 23, as the markets were roiling in the face of more bad trade news, someone bought 386,000 September e-minis. Three days later, Drumpf lied about getting a call from China to restart the trade talks, and the S&P 500 index shot up nearly 80 points. The potential profit on the trade was more than $1.5 billion."
https://www.vanityfair.com/news/2019/10/the-mystery-of-the-trump-chaos-trades
8
Your daily warning that ‘there will eventually be a nationwide recession’ sounds like the people at Times Square screaming ‘the end is coming! Repent!’
To be frank, the view from the cheap seats down here is much different than the view from the ivory tower on 8th and 40th.
During the Clinton years my pocket was full, gas was cheap and times were good.
Then came Bush and my world was upended, but we survived ok. My pocket was less than full but I was not broke.
Then came Obama. I lost my house, my credit is forever dead, my savings gone, 10 years later I am finally starting to recover.
During the last 3 years my pocket is getting less empty, I have some savings, and I will never again try to buy a house.
The money in my pocket, my higher income and more tells me I am doing a lot better now than when Obama reigned supreme.
Times are so much better for the little ants you see down below from your perch. Don’t ruin it for us by praying for an economic crash, please.
5
The crash occurred when BUSH was in office. Remember when the 2 presidential candidates were brought in to a Treasury-Fed meeting to tell them that whoever won would have to go forward with the 2nd phase of the TARP program.
Obama inherited a mess.
12
@AutumnLeaf That's some mighty impressive rewriting of history you've done there. The financial collapse occurred on GWB's watch. Remember "this sucker's going down"? That was Bush, not Obama. Obama was elected to catch the free fall and repair the damage. It was a long slog but he worked us out of it. All of the trends going on for the last three years have been nothing more than the continued functioning of the economy that Obama restored, with a bit of jitteriness introduced by Trump's weird trade gyrations.
5
Obama inherited a mess and chose to back Wall Street instead of Main Street. And here we are. Half the country is in poverty and more of the same, like Biden, isn’t going to cut it.
1
Everything that comes out of this administrations mouth is a lie, Everything is beautiful and everything is nothing but rot.
People have three and four jobs to make ends meet.
business is never going to come back to the US as long as they can use dirt cheap labor overseas. When companies left they left the American worker high and dry,
Workers are just being sold a bill of goods I remember when Apple told President Obama that American workers didnt want to live in dormitories like they do in China. Here is Apple with more money than most companies on Wall Street and they didnt want to pay a living wage, with benefits to the American people. Look At Amazon people who work in their warehouses feel like slaves and they hardly make any money. Every movement is reported on. Companies have no loyalty to America or to Americans, despite the fact that they made their fortunes here.
The pathetic GOP, Trump and the CEO's have created this economic mess. So to fix it the GOP will be sure to cut social security, food stamps, and anything else that helps real Americans because they can. This is capitalism in America home of the white elites.
4
Today's Deficit has increase to 4% of our GDP since Trump took office -- that increase is the fastest in our history (outside of the Great Depression & Great Recession). YOu get it right? We're in a supposed 'good economy' and our Deficit is ratcheting up that quickly? That's nuts. His 2 tax cuts for the Super Rich and Corporations is adding >$1.2TRILLION annually and in 2018, 60 US companies didn't pay a cent of federal taxes. They're not putting that $$ back into American workers -- they're buying up their stock....More?
6
The day the Trump boom died the DOW hit a new high......ok it hasn't yet but it's close! Timing is everything.
Not a fan of tariffs but I don't know of another option. Negotiate IP theft? "Xi - We agree to steal 20% less"? Say what? And what's going to be the enforcement mechanism? I think the China issue is YUGE, I watch the debates and the question isn't even asked. Perhaps Warren has a "plan"?
I will continue holding my breath.
2
No doubt our financial-political Elites are in love with Trump's blaming China for US Populism, even making himself the hero of the Working Class by promising to bring back industry and high paying jobs to Americans. But in the meantime his Autocrats go unharmed and are still making their billions through using Chinese Workers for their expatriated enterprises, none intending to bring those Chinese based enterprises back home as Trump has promised.
Trump is walking the line so well, being an Autocrat himself, but blaming the economic condition of of the US Middle Class on unfair trade practices by China (and other exporters to the US that contribute to our nearly $1T trade deficit and the consequent $1T US government budget deficit yearly.)
Trump has been very clever to win over Populists (who continue to lose) while actually serving US Autocrats (who continue to experience bigger and bigger winnings).
But it is clear, while Trump still has Wall Street and the US Autocracy on his side, he is losing his Populist base because they have seen no tangible results for themselves due to any policy actions he has implemented.
6
inherited strong economy low unemployment, did temporarily boost with massive tax cut to corporations already drowning in cash. We, the taxpayer will now be saddled with paying the debt of that corporate giveaway. Bring back manufacturing? Look at GM for one example of how that's working. In fact, trade war is wiping out sectors of our agricultural economy in ways that will take generations to recoup. Speaking of agriculture, we have now supplemented farmers in excess of what Obama's bailout of auto industry cost, only we, the taxpayers were reimbursed for that loan; we will never be recouped for the farmer bailout. Throw in being a POTUS only concerned with his base, who has surrounded himself with sycophants and criminals and you have not so arguably the worst Presidency in history. These are inconvenient
facts.
9
But even if we are at war with Iran, hated by Europe, in a deep recession, without any export market, in a bear market, racked by protests, climate disasters, and gun violence, Trump, the anti-constitutionalist, will still be putting America First.
3
It's interesting that A.L.E.C. hasn't done a recent " Rich States/Poor States " tax evaluation since 2015-current edition.
No measure of state by state economic metrics since Trump took office.
-They were done on an annual basis until 2015.
4
I personally don't care for President Trump but I am doing far better economically than I was under President Obama. In terms of the national debt, it has been an issue for decades, and yet both the executive and legislative branches have done little to remedy the problem. I do see where the Dems want an ever increasing "undocumented" immigration which I don't care for. Dems want to tax me to pay for their far left programs. Count me out.
6
@Washington reader, count you out on healthcare, roads and infrastructure then?
Wish we could!
6
Of course you’re doing better off economically now: the economy has been growing since Obama’s second year in office. You’re giving Trump credit for Obama’s achievements. And Democrats aren’t “for” illegal immigration: they’re for treating immigrants humanely. And yes, they’ll tax you (proportionate to how much you’ve benefited from the US economy) to support programs that “raise all boats.” Please stop listening to right-wing propaganda (“lies”) and educate yourself.
10
Deficits were going down under Obama; they’ve doubled and are rising under Trump. Illegal immigration was down under Obama; it spiked under Trump.
And if you’re more than a workerand you’ve profitted under Trump, you’ve done it at the expense of workers current and future.
1
The China trade war would have made a lot more sense a year or two after passing TPP. That would have actually allowed businesses to diversify their supply chains in an orderly manner that would insure stable costs and reliable supply.
Because that wasn't done, the cost of moving to other countries are both higher and more risky. People have been forced to move without adequate quality control, labor training or even knowing if the infrastructure to move their supply chains were adequate to handle their needs. Businesses also don't know if they countries they are moving too will be next on the tariff list.
Tariffs aren't inventory, tariffs are paid when goods come into port. They impact cost and they have a huge impact on cash flow. The cash flow squeeze that isn't even discussed is going to bankrupt customers.
If we get a trade deal that lowers tariffs, inventory valuations will have to be marked down unless tariffs are brought down retroactively. That impacts revolving loans on inventory.
As far as moving companies back to the USA. We have virtually no unemployment in the USA and we lack skills because of a poor education system. We are also clamping down on immigration both legal and illegal.
5
Trump's biggest mistake was listening to Peter Navarro, another former Fox News talking head. He is the real "Tariff Man."
There are reports Navarro and Steve Mnuchin, one of the few remaining adults in the room, have had shouting matches which Trump loves to witness like a WWF match.
I've seen Navarro, I mean 'Ron Vara,' interviewed numerous times and he's the March Hare of economists. Dr. Krugman made his feelings quite clear.
2
It is. in my opinion, of course imperative that Trump lose next year. but it really gets me down that this may be for 'shallow' economic reasons — that somehow the unconscionable attacks on the Constitution, the environment, and our place in the world are not good enough, but that a lost job here, having to cancel a vacation there, or fear of no pay rise will do the trick. And I really don't know that I can blame this apparent moral vacuum on anybody. At the end of the day, is this who we really are?
7
Recession is coming. The only real question is whether we will see it before or after November 2020. Most experts think after -- I think before.
I'll be particularly interested in the BEA's consumer spending stats that are due out on October 31. Manufacturing is already in recession. If consumer spending starts to dip as well, stand by for a serious reaction in the stock market.
1
I share in Paul Krugman's basic analysis. However, Krugman underappreciates the significance of Trump's anti-Chinese campaign. With the impeachment and the slowing economy, the anti-China card is the only thing that Trump has left to play. And, if you're paying close attention, anti-China sentiment has become intense and it's one of the few political items that both the American right and the left agree on. Whether it's Hong Kong protestors, reeducation camps for Uyghurs, the alleged theft of American intellectual property, or cheating on trade, anti-Chinese attacks have united Mike Pence and Beto O'Rourke and Ted Cruz and Julian Castro. The traditional conservative Sinophobes like Peter Navarro, in other words, are now joined by liberals and progressives who are buying into China as a great repressive monolith. For the 2020 election, Trump will pivot off the anti-immigrant narrative by declaring victory and will focus on China. He will blame China for the failure of his economic policies and recite a long list of grievances. In doing so, he'll tap into the ugly history of American anti-Chinese sentiment that resulted in legislation such as the Chinese Exclusion Act of 1882 and withheld American citizenship until 1943. The boogeymen of illegal immigrants taking American jobs in the Midwest got Trump into the White House in 2016, the reprise of the Yellow Peril will get him back in 2020.
3
If unemployment remains low that will be the message trumpeted by Trump. The other economic indicators will be lost on most voters. If Trump were even a decent president he would win in a landslide. The electoral college was concocted along with the 3/5 compromise as a way to shift power to low population slave states. I wish this were discussed more in forums like this. Time to elect the president with a popular vote.
13
Oh, Mr. Krugman, you, as always, speak such wise worlds.
I wish you would use your great insights and intelligence to speak even further of the needs of the people, which have been disgracefully neglected for the past 35 years.
The present trend is to reduce the population to the level of third-world countries while a major portion of income goes to the top 10%. 1% of the population still earns more than the bottom 50%. Obama did very little to stop this downward course, and the Democratic party cannot be counted on unless we convince it to support a truly vigorous campaigner for the people, Bernie Sanders.
Bernie is the only candidate who, by restructuring our government in favor of true democracy and the people, will shut the door on trump, his rowdies and others like him for good.
2
I don’t care how well or not the economy is doing. We now have no functioning federal government. In its place is an organized crime shakedown operation, abetted by an attorney general who is criminally investigating Trump’s political opponents. He has no advisors, and the man who knows nothing thinks he knows everything. The so-called great deal maker gets rolled by almost everyone he interacts with.
None of this is OK regardless of how much money is in our pockets.
21
I don't question the facts in this article but the market (S&P 500) still has a positive trend. There must be reasons for that. Would love to see an explanation.
1
One hopes the American people realize that Trump inherited a good economy because of the work of President Obama and his administration. Trump did not cause today's "booming economy." Indeed, he's well on his way to destroying it.
19
With or without Trump reelection the question that Trump policies bring to my mind is: Are the United States willing to keep its leadership as the top power in the World incurring the costs this has?
4
Are there any possible stories that directly link the economic positives to Trump actions? Politically, we usually attribute the strength of the economy to the present president. The only stories I see tell me that Trump actions are hurting the economy.
Of course the Trumpies have been jubilant about the economy from the get go. I take that with a grain of salt. They are overjoyed about the economy principally because their person is in the White House.
Here in the real world there is simply too much to not be jubilant about. We work two jobs. Half of us can't afford a single unexpected $400 health bill. Most of us have zero retirement savings. Buying a house for many is an impossible dream.
Yep. The tax cuts did less good than even the skeptics expected, and the deficit that it caused will hurt working class and middle class Americans. The trade wars have done more harm than even the skeptics expected.
What about the unprecedented deregulation? I myself look at the harm it is doing and am crestfallen. Lately even business interests have opposed this deregulation, even when it applies to their own industries.
Business uncertainty has exploded. Business interests realize that Trump and his associates are erratic, unhinged and untethered, and have no idea what they’re doing.
That is principally what this White House has given us. By and large the economy has followed Obama's trajectory. Trump alone has blessed us with this unbelievably chaotic uncertainty.
11
A fine analysis, Paul. But no one should know better than you that next year's election will be about THREE things, not two.
It will be, as you write, about Trump's betrayal of his oath of office and it will be about the economy. It will also be about the counting of the votes, as it was in 2004, when you briefly were given the green light to write about the evidence that that counting was not, shall we say, accurate and honest.
Since 2004, the vulnerability of our concealed, computerized vote-counting process to hacking and rigging has only grown: the level of security remains laughable and the roster of those motivated to breach it has greatly expanded.
As in 2004, those with access and motivation are pretty much all facing in the same direction: towards the right. In 2020 that means the re-election of Donald Trump and enough enablers to sustain his power through another term of accelerating depravity.
So, while Trump's betrayals of his oath and a faltering economy should guarantee his tenure ends in January 2021, right-wing control over (and foreign access to) the computerized counting process might - in conjunction with the vagaries of the Electoral College and an unhealthy dose of voter suppression - well subvert and reverse that calculus.
You know this, Paul. You've known it since 2004. It's time to once again write what you know.
5
Here I am, retired, with a mortgage, living on a small pension and social security and I just got a notice from IRS that I owe $5000 more in taxes and, if i take that from my IRA, it's taxable.
And yet, I'm still hoping for an economic downturn. Let Donald take credit for that.
16
"I mean, considering that trade confrontation with China is the centerpiece of Trump’s economic policy, it’s not reassuring to learn that his trade war czar, Peter Navarro, has an imaginary friend — a source named “Ron Vara” whom he has repeatedly cited in his books, but who doesn’t exist, and whose name is in fact just an anagram of “Navarro.”
REALLY????
10
What was the day?
1
Krugnman - you've been writing this same article every couple of weeks since January 2017. Not to say you won't be right at some point, and maybe even soon, but your prediction credibility is really eroding!
8
Ron Vara must be laughing very loudly at the whole bunch of criminals running our economy. Maybe the Justice Department should investigate him and Trump's imaginary "friends" tool
7
Oh pshaw! Trump says it's easy to win trade wars!
4
"On that goodwill he conspired to prey
On every mortal weakness, through bribery
And subterfuge and flattery called counsel
Gaining trust and power in council
Till at last he held the purse of nations,
And by and by their destinations,
In his hands. By his leverage of debt
Their treasuries, lands and wills were forfeit
To his benefit, and legislatures
More and more became his creatures
And their laws became his laws,
Written to serve the Father of Lies.
Economies were his, and then the Press
Aggressively he made his business.
The engines of truth used by Luther
He owned, and now he was the author
Of the public mind, of history the editor."
http://forthesonsofthewest.home.blog
2
Didn't you also say that the stock market was going to tank when Trump won the election? Yeah...I thought so. I take your opinion pieces as just that: opinion.
10
Wishful thinking!
2
Didn't Trump also have an imaginary friend(s)....."John Miller" or "John Barron?" We need to remove these people before it's too late. Impeachment now!
7
"...expected the tax cut to do more good, and the trade war less harm, than they did."
Why? After nearly 40 years of trickle down theory resulting in hoarded cash, why did anyone expect the latest raid on our treasury to do any good? And for whom?
During the election, I was sure that even the greediest Republicans would vote for Clinton because she'd be predictably pro-business and because markets do not like loose cannons. Alas, the dollar signs in their eyes prevented them from seeing the dystopia on the horizon.
8
Trump's base doesn't care. There are plenty of voters who dislike Trump's tweets and grandstanding, but like his policies and their effect and will vote for him.
4
@Ek Rust belt workers and farmers who are losing their livelihoods are not Trump’s base. They were fooled once. Let’s see if It works again.
2
We don't say this often enough: the now concerted attack on multiple institutions (DoJ, Treasury, State, Commerce, Education, Transportation, etc.) by GOP is sending a loud message to the world. We can withstand an unstable Trump, but when these corrupt institutions turn this nation into the world's largest banana republic, the resultant and widespread rot in this administration is declaring to the world: GUNS FOR HIRE; CASH ONLY; NO QUESTIONS ASKED.
If that's not uncertainty to businesses, nothing is.
7
I humbly submit that when the dust settles and economic history is written extreme wealth concentration coupled with increasing monopolistic inefficiency will be seen as the culprit. I believe we are bearing witness to end-stage capitalism - unless we are smart enough to remove the obscene level of money influence from our political system. Just now, we have our hands full trying to remove a corrupt autocrat.
12
When Barack Obama was president, republicans preached about the deficit as if it were all that mattered. We were hectored regularly in a righteous manner by sober and serious men who were "thinking about the burden we will leave our grandchildren" . All those sanctimonious sentiments seem to have evaporated. And, as we know, the deficit has skyrocketed.
I expect that when a Democrat is inaugurated in January 2021, the deficit will somehow become important again. This isn't chutzpah, it's cowardice.
12
You mention business uncertainty brought on by the trade wars. To that we should add business uncertainty related to climate change. Addressing climate change - both with new technology to reduce greenhouse gas emissions, and measures to adapt to the future warming that is now baked into the system - requires the investment of capital and the recruitment of labor. Yet America has made no committment to do anything about greenhouse gas emissions, and there is no way to estimate how high greenhouse gas levels will go, and on what timeline, to make decisions about adaptation.
And nothing can change soon, because Trump will bequeath America a new Deep State of his own creation - stupid and venal people ensconced at every level of government, who will insure that for a generation, America is reliably the Stupid Country of the world.
5
Dr. Krugman is always so spot on.what still worries me is that so often people vote against their own self interest- even that of their children ie Kansas and all the states cutting university payments. Trump could still fool so many folks who appear blinded now to all the horrid things he does. Much will depend on who the Dems put up.
3
@alf13 The Dems are just plain dropping the ball before the fact, as they are offering zero, nada, zip, but people will vote for anyone to get the megalomaniac out of OUR house. This in itself is dangerous, because of the simple fact that politically motivated suicide (anyone but Tchump) is NOT the right answer. I see no one worthy of my vote. Not a one!
1
@Mike OD A vote for nobody is a vote for Trump.
1
Really?! "But the truth is that even pessimists expected the tax cut to do more good, and the trade war less harm, than they did."
None of my friends or acquaintance ever, ever thought such a thing.
We saw the tax cuts for what they were- a specious pretense about injecting money into the middle class that was really destined for corporations.
And the trade war was obviously a boondoggle from another era, dusted off by an egomaniacal nincompoop whose skill set is sinking companies.
Who exactly, besides Trump acolytes and toadies, were these folks who thought either one of those moves could cause "less harm," Paul?
They were clearly nothing but trouble from the inception.
8
As a 74 year old retired white guy who spent 15 years working in three of Ohio's prisons and a Vietnam Era Veteran (whatever that's worth), I'm supposed to be in that group of white guys who voted for Trump. I'm not. Our state of mind in America has deteriorated so low with his supporters at those rallies that he could give them a blank check and they'd be convinced that they're "makin money". Maybe they are. While I appreciate Dr. Krugman's article, most of Trump's voters wouldn't take the time to read it let alone learn anything from it. These are the same people who will vote him back into office for another four more years of dumb damage to our nation while Trump and his Ivanka load their pockets with money. But hey, this is how WE Make America Great Again.
10
Can we please dispense with Republicans stormed the whatever. As we saw on the news, no one stormed anything. What we saw was a bunch of Republican hypocrites a third of whom are on the committees holding the meetings. Thus privy to everything taking place. Credit the press for not making this clear out of the gate.
7
We cannot afford a world that does not recognise the huge cost of climate change.
The young people know it.
We are holding on to our money to spend it on the YUGE party I’m throwing when Trump is removed from office and his cronies too!
6
"Next year’s election should be about Trump’s betrayal of his oath of office."
However, despite all his weaknesses, plain stupidity and constant impulsivity, Donald Trump has a unique gift, which few others have is that people tend to be drawn to him, and almost eager to serve him. He knows it as he has experienced it all his life. You can call it charisma, charm. likability, whatever - examples of such leaders, without Trump's baggage, are Fidel, Mao & Lenin.
With that gift, Trump has a much higher chance to be reelected. Discounting it will be at our peril,
Being a (white) woman, after Hillary's loss in 2016, Elizabeth Warren COULD have had a great chance to beat him. But then she started her campaign with her extravagant idealistic plans, pitting the rich against everyone else, with her "radical" taxation & giveaways. If she did mean them, she should have made wager statements about all her plans such as these are "my goals, but I may not get all of them implemented in a democracy, with powerful and resourceful opposition." Of all her plans, canceling existing private health insurance has the worst, scary image!
Warren has baggage too: claiming to be Native American in an application. She lacks a benevolent disposition; she wouldn't look at Joe Biden, or acknowledge his role when he said he got HER legislation passed, but thanked only president Obama.
4
@A.G. Most Americans don’t find him charismatic. Now having experienced the enormity of his twisted personality, his gross incompetence, and his disastrous policies, like trade wars, I have every reason to believe that his razor thin margins in 3 rust belt and farm states that gave him Presidency, will not be repeated.
4
@A.G.
Correction: I meant vaguer, not wager.
I am sorry.
@Doug Lowenthal
This is what far too many Hillary Clinton supporters & HRC herself believed in 2016. But he won, with all the consequent calamities.
Nevertheless, if he hadn't done what he just did by abandoning the Kurds, his first (hope his last) term, except for the tax-hike & the federal judges & the two Supreme Court Justices, all thanks to radical Republicans, wouldn't have been bad.
I voted for Barack Obama twice. He got us Obamacare & saves the economy from going into recession. But his Middle East policies were plain disastrous. He was responsible for the ISIS Caliphate & all but destroying Syria. His policies were as bad as those of GW Bush. I am very sorry to say. Trump bombed Syria twice, which were quite effective.
Incidentally I voted for HRC three times, when I could. But in 2016, she just blew it - her hubris & terrible off the cuff remarks like deplorable Trump voters cost US (not U.S.) the election! She's just fine, relatively. You & I & a whole lot of others have to put up with Trump.
1
Leave us not underestimate the old scoundrel. Trump is a good manipulator. He could well have planned this downturn, engineered by his tariffs, so he can create a relative upturn some months before the election, and paint himself as the hero of the economy! Even though he created this mess himself, he obviously does not take truth or reality into account, only political and dollar expediency. Just like the new "criminal investigation" into the Russia investigation, it is all for show and distraction. Watch out.
3
@JS A recession is inevitable.
2
The longer term is even worse. Mother Nature never forgives a debt.
5
And how smart is Navarro? He had to make up a word that doesn't exist for his anagram to work.
5
Economic prognosticators should be required to post a score card of the accuracy of their previous predictions.
2
That anyone has any confidence in anything that Criminal Trump does considering the incompetents and know nothing fools that surround him is astonishing.
2
The Trump boom may be dead or dying. But that doesn’t mean big business won’t for him again. Or that his base won’t see it as a small price to pay, so long as he is preserving their white privilege.
3
The new Netflix series, “These are Very Strange People”, ready for cringe watching.
3
trump, the crowing rooster, took credit for the rising sun, now trump, the grifter, is incapable of taking responsibility for his failed trade war's negative growth on the economy. I'm sure trump, the deflector, will blame a declining economy on the Dems, Clinton's emails, and Obama.
5
If the economy is suffering, then Trump supporters, on the street, have yet to get the word. Until these people start to recognize there is a problem, they are not going to take Trump's crimes or the impeachment proceedings seriously. The fact is, if you are making $25,000 per year or less, then you are at the bottom of the sea where nothing has changed in 50 years, and waves on the surface have no meaning. And if you know no history, have no curiosity or imagination, never read a newspaper, and are fed the righteous propaganda pablum of the FOX opinionators, your mind has been put permanently to bed. When are the people at the economic bottom, who have adjusted to few expectations and live vicariously through Trump's gold bathroom, going to feel it?
8
Tariq Aziz.
Reading this column, there never was a boom. Election Night was full of dire statements, it was all over. And so on, ever since. The hatred of Trump is always greater than any love for the truth.
You've lost credibility, except to the doctrinaire people who want a stopped clock.
Get back to All the News That's Fit to Print, and ditch the dogma.
2
Unemployment isn’t just very low - it’s at an all time low, especially for Blacks and Hispanics. Consumer confidence and spending are up. Paul has been trying to send us into a recession since January, 2017.
4
The way things are going they all will need imaginary friends before this debacle ends.
1
Did anyone ever think that the fall in Business Confidence might be due entirely to this abortion of an Impeachment proceeding?
I'm sure a genius like Krugman considered this, right?
2
It seems that most of the people that Trump surrounds himself with have « an Imaginary friend » except Trump himself whose only friend is a very stable Genius.
What a strange administration indeed!
1
So our Trade Czar has an imaginary muse he can cite as an authority? I now wonder what or who is Trump's muse? I think it's Ivanka.
1
There sure aren't less poor people. Start with the homeless
numbers.
2
Ron Vara for President - couldn't be worse.
1
Every day when I read articles like this I wonder if those who voted for the Gutter Rat thought this is how things would end up. It makes my head explode.
4
S&P 500 annualized rate (adjusted for stock splits and dividends)
This administration, so far:
2017: 23.9%
2018: - 4.2% (negative)
2019 (first 9 months): 10.9%
2017-2019: 10.5%
B. H. Obama, 2nd term: 11.1% per year
For the last 38.75 years
The average Republican administration (22.75 years): 3.6% per year
The average Democratic administration (16years): 14.4% per year
Average increase in the S&P 500 in an 8-year administration
Republican : 33% (This one so far 32%)
Democratic : 193% (almost tripled)
Source:
https://finance.yahoo.com/quote/%5EGSPC/history?period1=971064000&period2=1128830400&interval=1mo&filter=history&frequency=1mo
This administration’s performance so far:
Better than the average Republican administration
Not as good as President Obama’s second term.
10/25/2019 7:26 am
2
It's the Obama Boom, started under Obama and continues.
2
Too bad the Dems have an aversion to going bare knuckle. It certainly works for the repubs.
1
Businesses have finally realized that Rocky's description of Paulie fits the current situation to a "tee": Trump is mentally irregular.
Paul, how many times have you been wrong about Trump? In Nov 2016 you predicted an economic global collapse because of his election. And since then you have told us the sky is falling a hundred times. I could never be wrong so many times and keep my job, how do you?
3
Immediately...
The Dems should pair Jackie Speirs and Adam Schiff together for media interviews.
Much, much stronger that way.
It is not uncertainty that t rump and his cultists are causing; it is chaos.
4
Fact Check: True
For those geniuses (sic) that cheer on the ‘disrupter in chief’ this is the other side of that coin
It’s called ‘the US economy’s payback”
Will someone please put the nails in the coffin of this trickle down know nothingness?! Bury it good
2
Essays (and headlines) like this one sound as though Dems want the economy to fail.
2
I am of the belief they do want the economy to crash as that is their only path to victory in 2020. People may disparage Trump, but no one with any amount of money in their retirement account wants anything that could trigger a downturn like Bernie or Warren will bring.
1
All well and good but what about the “election war” that Trump will start with Iran in July?
2
Even though Mr. Mann Krug may not agree with the economic musings of a certain Mr. Ron Vara, is it not too much to ask the dying NYTs Fake Media to make a minimal effort to dig up some corroborating vouchers for Ron Vara?
Would it have been so hard to reach out to John Barron, Pierre Delecto, Carlos Danger, Igor Fruman (obviously fake name!) or even the very accessible and transparent Moscow Mitch to determine the validity of a certain Mr. Ron Vara?
Is that asking too much?
1
As I read the comments I can not help but think that you, gentlemen and ladies have a giant flaw. You think, you read and stay up to date on what is happening and because of this you are the hated elites. I’m sure that many of you check multiple sources for your news. Please remember many if not most of his followers do not. Just because you can see and understand what might be happening, they most likely can or will not.
3
Thank you, Dr. K. Rugman...
Nothing, known to me, proves the adage “Ignorance is Bliss” any better than reading Trump-related news articles, and columnists discussing Trump (such as Paul Krugman) in the New York Times every day,
Often, I wish, that I had been born into a tribe(aka, a religion) in which I wasn’t required to be aware of anything that was happening outside of my tribe, and, in the event that I needed to know anything at all (i.e; in order to vote) my tribal leaders, and Fox News, would inform how do so accordingly.
However,, at my advanced age, another adage kicks in: “you can’t teach an old dog new tricks” — in other words, I can’t stop myself from reading the NYT everyday
Thanks to Trump, My blissfulness (if it ever happens) will only occur after I die.
Keep it up, Dr. Krugman “For you knoweth just what you doeth.”
"uglier than I can possibly imagine"? I've been learning about the decline and fall of the Weimar republic at "Between 2 Wars" on YouTube.
Speaking of bad behavior...can you imagine what Trump will do with the time between losing the next election and the inauguration of the new president?
1
Where is the confidence fairy when you need her?
Don't forget, Trump has damaged the United States as a brand. We are viewed as the United States of Trump by many. I know this is not fair (Many in the United States are not Trumpers), but 200 hundred years of "Democracy" is in the process of being destroyed. For instance, Chinese purchases of houses in California are down because they do not want to live in the land of Trump. The damage to the United States as a brand is difficult to measure, but eventually it will influence the growth rate.
1
Not unlike Paul Krugman, I too have fears that Republicans in the Senate may not have the strength of character to confirm an impeachment unless they fear the prospect of not being re-elected themselves. Trump’s misdemeanours are huge and fall squarely within the thinking behind the powers of impeachment postulated by America’s founders in relation to assistance sought from foreign powers to assist in one’s election. Yet this may not be enough?! What is far more likely to destroy Trump is your observation that despite the relatively favourable unemployment situation, the business community have finally got around to the view that this man is a highly unreliable person generating uncertainty which cannot be good for investment decisions. The trade War with China seems to have acquired its own momentum and no one knows the end result. Trump’s adventures on the diplomatic front are floundering equally spectacularly adding to a growing feeling of confusion and uncertainty. This will probably sink him.
3
I found an interesting explanation of game theory the other day: the way you get the most is to keep playing the game instead of trying to cheat the other player out of as much as possible. American businesses need to keep playing the game with confidence, but Trump wants to grab as much as he can and walk away.
If we could also look down the road a bit.....even though lots of Americans are not interested in doing that....if you don't like the way the United States does business and all the threatening Trump does, might you not prefer looking to other, more reliable and less reactionary sources for the things you want? And might you also be looking for products that are forward thinking, like electric vehicles? Let's see where could you find those?
Where could you find electric vehicles? How about China, Japan, Germany, England, France, Korea, etc.
It's interesting to me as a reader and a commenter that very little of the reporting or opinion page writing concerns how precarious life has been for working Americans. There seems to be a blind spot when reporters and pundits write about the economy for working Americans. Just because money is being spent doesn't mean that we're economically secure. Just because the economy is expanding and people are being hired doesn't signify that we're doing better.
The employment figures we hear at the end of each month never mention if those jobs are permanent, have benefits, pay a living wage, pay overtime, etc. If we don't apply for unemployment, aren't receiving it, have stopped looking for a job we aren't counted as unemployed. If we're not between the ages of 25 to 54 we're not prime working age despite the fact that we can't collect Social Security or touch our IRAs or 401Ks without a penalty until we're the right age. In other words the way we measure unemployment is flawed to give favorable but untruthful figures.
This country doesn't want to do better by its people. It's that simple. Trump or no Trump we don't want to improve the social safety net. We're nurtured on the idea that anyone can be rich and that we can do it by ourselves. Nothing could be further from the truth. And the longer we hang onto this delusion the more we alienate and hurt people who have played by the rules but are losing anyway.
10/25/2019 11:46am first submit.
6
Paul, I remember being puzzled during the 2000s housing bubble. I was accustomed to periodic reverses in the Los Angeles housing market and could not understand why the correction was not taking place in the usual time frame. It seems that one of the driving forces is the relative lack of diversity in reasonably safe investment options. The other is the international flow of capital. As others have commented on here, our stock market is now being propped up by foreign investors. Similarly, Los Angeles and other major cities are the sites of money-parking schemes by Chinese and other foreign investors in splashy high rise residential projects. At the same time, a growing number of retirees dependent upon 401K's instead of pensions are desperately seeking rates of return sufficient to sustain their circumstances. These two forces combined are making the advent of any economic correction "sticky" and apparently will once again delay the reckoning until the delay makes it worse than normal. Other commenters have predicted that this probably will not occur until some time after the election. I am also of this opinion.
4
Well, the economy has certainly been his friend for the past three years. Record low unemployment, most noticeably in the African American community, record stock market highs, record earnings for public companies. Which of these do you think is going to bring him down? By the way I recall, as do many others, your comments at the time of the 2016 election that the economy and markets would collapse if Trump were elected. Still waiting for that, though I admit even a stopped clock is right twice a day.
5
Of course Ron Vara exists. John Barron knows Ron Vara very well. They have worked together for years and both have made a beautiful fortune on their deals.
2
While Trump has a full share of making the economy worse, the fundamentals are not helping. The increasing levels of automation/technology in all businesses is - in effect - reducing the value of human labor. Yes, there are jobs that are in demand - health care, technology - being prime examples, but for retail, manufacturing, the result is stagnant wages in the face of rising of medical, education, and housing costs. As the benefits of technology/automation accrue to capital, and not to labor (contrary to the optimistic future of The Jetson's), income inequality grows. In time, many will be unable to survive on what they earn, without wealth transfers that the owners have preemptively struck against with the last tax 'reform'.
3
@Bruce Maier: Technology catches up to the vision of Karl Marx. When robots do all the drudgework, owning a piece of the means of production will be the primary way to make a living.
Only a few people saw the 2008 crash. Like right now things seem fine but in your gut you are on egg shells. Just like a cheap movie " it's to quiet out there". I don't know where it will come through and it may not be next year. The stock market is being kept high with low interest rates. Maybe the big crash will be in a treasury bond sale failure. If that happens really watch out, we are thoroughly addicted to low interest rates.
2
Trump will claim that we have a “beautiful” economy, the best ever because of him. The media will incessantly cover Trump’s lies without exposing the inaccuracies. Trump (and the Republican establishment plus business leaders) will shout that Democrats are socialists and communists, thus influencing voters and the end result will be a second term for Trump despite the disaster he is and has created.
4
@Michael Tiscornia And quid pro Joe will continue to give himself and Obama the credit.
1
These are not normal times. The good Prof. Krugman has given us reasons to be wary about the current occupant of the White House's re-election chances, and I would take heed of them if this were a "normal" re-election. But this is patently NOT a normal re-election, any more than the presumptive Republican nominee is a normal person. One of the rating services (Moody's?) ran the economic numbers through their algorithm and, voila(!), The Donald wins in a landslide! But that formula was, again, based upon other things being equal, i.e., a normal candidate in normal times. We couldn't be further from that normality.
The stench of The Donald's presidency has no parallel in our 200+ year history, and that smell has even begun to be noticed by three disparate groups, Obama-Trump voters (always an anomaly anyway), a small slice of the normal GOP voting base, and even the occasional GOP legislator who has finally found his/her spine.
There is one more point to be made re the 2020 elections. Those who oppose this awful man are motivated in their opposition like nothing ever seen before. Let the trial in the Senate fail. That will merely identify those (Republican Senators) that deserve to be defeated right along with him.
Lincoln said, "You can fool some of the people all of the time, and all of the people some of the time, but you can't fool all of the people all of the time." Trump's vaunted "base" is fooled all of the time. That leaves everyone else, and we're not fooled.
7
Trump's main economic crime is driving up the deficit by cutting taxes and throwing more money at an already bloated, unmanageable military budget without spending one dime on the future of America.
Debt can be a good thing. If money is invested in the future, there is expectation of increased value down the line. Therefore, it makes sense that such a debt be spread out to all who will benefit now and later. Spending on education now will increase the future earning power of students and help society as a whole avoid social support costs. These educated workers increase the gov't tax revenue and they are then helping to pay the debt that provided the benefit to them. Simple economics of government spending.
The Republican cry that private industry should not be taxed but who benefits most from an educated populous...business. Their other talking point is Dems are saddling future generations with debt is stupid but effective when directed at an uneducated voter. Spending on good (being the operative word) social programs, education, infrastructure, energy policy and even nat'l security is sensible when it will have an amplifying affect on future income and reduce future social costs.
Sad, like all things Trumpian, he will have left the building by the time the lack of investment in the future starts to affect our lives.
The business softening now evident is from consumer exhaustion from buying too much stuff. Trade has slowed because the rest of the world hates us.
2
In a sense, it isn't reality that the Democrats are running against, it's a narrative cobbled out of decontextualized bits of data and information and framed into a fictional or semi-fictional story. The Democrats need to appeal to the demographics that are under attack. They need to do a better job making the case that neoliberal indicators of a healthy market can't explain away the very real struggle that too many Americans face and will face to a greater extent in the future if things keep heading in this direction. How many homes or cars sold this quarter won't explain why so many can't afford them, nor will it shore up Social Security, forgive an assault on healthcare, provide affordable college, protect rights in the workplace, protect women's rights, clean toxic air and water, or take automatic weapons off of the streets.
The Republicans have done a great job of telling fairy tales about rising tides to garner votes while siphoning away America's collective wealth and power to very few at everyone else's expense.
7
Trump's economic surge was never real, it was more like a looting by those who smashed and grabbed what they could under Trump, knowing that he would let big business get away with anything in exchange for stock market gains. Now that he's in trouble they're reverting to norm.
9
@M Davis I suppose you don’t have a 401K or any investments.
1
....." Republicans have proved willing to engage in stunningly bad behavior."
No matter how bad the economic numbers get, DJT and his sycophantic supporters will blame the data on the "deep state" trying to "get" him and the "fake news" media disseminating that data. Or, the economy is crashing because the Dems started an impeachment process. Or, the Dems didn't pass his "new Nafta" bill, or..... At no time will DJT take responsibility for anything he does, and it is up to the rest of us to make sure that whether by impeachment (& conviction in the Senate) or our vote in November 2020, DJT is removed from the presidency and the GOP is swept out of office and control of the Senate.
6
What is the possibility of rolling back the hurtful trump tax cut?
6
The media and everyone on the left have been forecasting this economic downfall and recession ever since Donald Trump got elected and funny how the actual numbers have always shown the contrary. It almost feels that you are hoping it will eventually happen by constantly talking about it. I am an ordinary public employee and our family have been in a much better shape financially the past 3 years than we were in the 8 years before Trump was President.
4
And where is the pessimism coming from - the depression that the national spirit feels because the country has lost the respect of the rest of the world.
5
Businesses hate uncertainty. The decision to make capital investments is always difficult because the payback often takes a decade or more even when there is "high certainty" about the business and regulatory environment. Trump's willy-nilly approach to governance means no one can make a reasonable forecast about the business climate. If that's the case, better to stand on the sidelines and wait to see what happens.
We have no evidence that Trump has become or will become more systematic in his approach to governance, hence business leaders should have tremendous concerns about four more years of living with policy driven by Trump's gut.
6
YES. Let's not forget the debt.
How can we ignore that the homeless and addicted are NOT counted in the low unemployment?
How do we justify delays in facing LESS production of STUFF is a part of transition to a healthy environment?
Will we continue to extract fossil fuels for global trading and try to become more committed to renewable energy locally? What's the transition plan?
Are we looking at disaster cost prevention or continue to live where disaster is inevitable due to climate change?
Where are the economists in all this?
4
The question will be the effectiveness of the Mother of All Gas-Lighting Campaigns by trump, his party, and his state news service and other bad actors including trump's dictator pals. This is not the gas-lighting going on now. It's what will be unleashed in response the impeachment hearings, senate trial, and reelection campaign to tilt the perception of the economy, and trump's crimes.
So it's not the economy. It's what the red and swing state voters can be convinced to believe about it when they vote in Oct/Nov 2020. 270 electoral votes.
3
Krugman makes a lot of sense. However, what's going on with the stock market? Usually, the market reflects belief about the future economy. Have professional investors now just become day traders, making some quick money on the latest Trump tweet or statement about trade? I certainly wonder.
3
I've amused myself these past few years poking fun at Trump's "unprecedented economic boom," which in his telling is nothing less than an "economic miracle." Because the self-aggrandizing Trump can't resist dissing Obama, I've concentrated particularly on demonstrating how Trump has consistently under-performed his predecessor in job creation his entire time in office: https://tinyurl.com/y6e2wjeu
The jobs gap between the two presidents is enormous. Over the 30 full months of his presidency, Trump has created 6 million jobs for a monthly average of 188,000. Obama created 7.2 million jobs over his final 30 months for a monthly average of 224,000. Obama created 36,000 more jobs per month than Trump!
Obama averaged 207,000 per month over his final 5 years in office. Yes he did!
All kinds of caveats of course apply, but we can relax our standards when poking fun at Trump, who has no standards at all. If we wanted to be fair, we'd say that jobs are harder to come by at the end of a very long economic expansion when the labor market is tight. But then, that tight market is what has driven the unemployment rate to a 50 year low -- for which Trump insists on taking personal credit.
If Trump were honest he'd acknowledge that instead of working miracles, what he's done is basically continue Obama's economy. For example, see the two charts here: https://tinyurl.com/y5qud8nc
In truth, at no point in his presidency has Trump matched Obama's jobs record, even in the early going.
12
@Mike
In my remarks above I said "30 full months of his presidency." Of course I meant 32 months.
I wish it were not true, but Dr. Krugman's assessment is wishful thinking. There are two economies in the United States. One that Krugman accurately describes and pertains to businesses and investors.
The other America is wage earners, the majority of voters. Like it or not, Trump has delivered for lower earners, or at least was present when it happened. Wages are outpacing inflation for the first time in decades and hours are up. Ordinary Americans are feeling flush.
In a democratic election, wages count more than GDP. Unless there are layoffs before the election, Trump voters will remain loyal and will be out in force. All the worse for America.
3
So a little micro perspective. Yesterday I was having a beauty treatment which always involves conversation. My lovely beauty provider told me that everyone she knows who is a sole proprietor is suffering a slow down in clients. Material costs are rising and clients are pulling back for financial reasons. Ears to the ground.
14
@Lilnomad
Let me add as a gig person that government tech uncertainty has bid contracts on hold. In addition, recent news of friends' layoffs by big consultancies reflect the same issue of delayed decisions on a larger scale.
2
Columns like this should be a wake-up call to the Democratic candidates.Yes, things like the costly healthcare system, racial injustice and student debt need long-term attention, but so do the federal deficit and business confidence, which won't be helped by railing against "corporate greed." Trump's economic recklessness offers the Democrats the issue of fiscal prudence, for a change. They should seize the opportunity.
10
Yours could be a GOP talking point, as they always spend big, and always tell Dems to control spending.
Democrats have been hoping for and predicting a recession, to hurt voters, because that would also hurt Trump.
At every hint of it, they've cheered.
Now they think they've got it, and they are delighted.
That is very short sighted. Voters don't want to be victims of a recession, just to advance the partisan hopes of the out-party.
Some voters will remember all this, and resent it. Democrats cheering it are very short sighted.
6
@Mark Thomason
Unfortunately, that's true.
As a Democrat, in my heart of hearts I welcomed a recession so that president Trump wouldn't be reelected.
I live off of retirement benefits, which are stable, which is all the more indifferent.
3
Nonsense. Who are your sources, and what are your facts? Dems don't behave like that.
I think you are overly pessimistic. Earnings reports for the third quarter are pretty good. One reason for this is that business executives expected a pullback, and made needed adjustments. This actually improved the situation, and prevented a recession. Unemployment is still very low, and businesses are having trouble finding good workers.
I believe low interest rates are mostly due to overseas investors putting money into US Treasuries, and that if we had to rely on US investors alone, interest rates would be much higher. The US economy is getting the benefits of cheap capital flowing in from countries that are experiencing no or negative growth.
5
Economies go up and Economies go down but if there's food in the stores, cold beer in the fridge, most folks have something to do every day - job or school - all is MOSTLY well in the world.
As Bart Simpson would say, "Don't have a cow, man." Only one (small) word of warning: If you're making good money don't spent it all - put some in the bank for that proverbial rainy day.
Thanks for listening and keep smiling.
4
The Trump Boom believers are getting nervous about a Warren Wave.
Decades of both parties being 'business friendly' have led to massive inequality and a totally corrupt administration staffed by totally incompetent business men and women.
It may be too late for Main Street to recover from years of misrule by Wall Street, but that still doesn't mean there won't be some kind of reckoning. It's overdue.
6
“[The collapse in confidence] continued as evidence accumulated that the 2017 tax cut was a big fizzle, doing basically nothing to boost business investment...”
Did anyone seriously expect a “big boost” to business investment? I remember talking with a VP of Union Pacific Railroad about how his company planned to spend the windfall they would receive from the new tax plan; specifically, whether they would be buying new freight cars and engines, lowering rates for customers or giving raises to employees. His response? None of the above.
He said, first, they were already sitting on a pile of cash that more than covered any needed improvements to their equipment. Second, as far as customers go, the railroad pretty much owns the market so there is no motivation to reduce rates. Finally, union contracts were already in place and there were no plans to renegotiate.
So what would they do with all this new money? His expectation, which now seems prescient, was that they would increase dividends to stock holders and probably buy back some of the company’s stock. If anything was left, it would likely be paid out as bonuses to company executives.
So, no Mr. Krugman, no business executives seriously expected a “big boost” to business investment as a result of the 2017 tax cut. On the contrary, they and Donald Trump got exactly what they expected: a “big boost” to their personal bottom lines.
10
No one feels those numbers yet. That's the story here, not the numbers. It's what the voting populations FEELS that's important and determines whom they vote for.
Prof. Krugman -- when will the FEELING of a bad economy hit?
My prediction is after the 2020 election when it's too late.
3
Wall Street has cite Trump's boom, caused by the tax cut and regulation reduction, as great for the economy and the stock market. The problem is that neither the economy nor the stock market were doing better under Trump than under Obama.
5
I am not an economist, but it seems to me that much of the analysis is losing the forest for the trees. The republicans are particularly good at this with their supply side bias.
It seems to me that most businesses do better when they sell more widgets. They hire more people to handle the demand, pay employees more, or make productivity investments. Simply making more money (exclude businesses that are not profitable or marginal) doesn't do any of those.
If wages are stagnant while prices rise (or all the money goes to people who bank it) , then people don't have the money to buy widgets.
10
What you are seeing, with Trump, is the result of gerrymandering. When districts are gerrymandered, the political party in power is assured a Win at election time. Thus, the real battle takes place during the primaries. For a primary, the candidates end up leaning more and more to the extreme edges, where the money is. This takes place for both parties.
4
"To be fair, the overall state of the economy is still pretty good. Unemployment is very low and job growth is continuing. "
You keep missing the point. The "economy" for Wall Street is still pretty good. The real economy, for Main Street, is anemic at best. We have seen huge wealth disparity. People are employed, but under-employed. The living wage jobs are few and far between. People have to work longer hours, or more than one or two jobs, to make up the difference. The numbers are deceptive, because those at the top are MUCH wealthier than they were before, skewing the numbers.
We folks on Main Street are not as oblivious as the political class thinks. We can see that we are working harder, for less, and have no economic security. Most are a job loss away from homelessness.
21
The Trump Boom never actually existed. Remember the morning after election night, when everyone realized Trump was actually the U.S. president? That sense of foreboding?
Americans have been depressed since Trump's election, with toxic doses of cortisol (the stress hormone) coursing through their systems. Everyone's quality of life has diminished since Trump was elected.
Unemployment may be down, but those statistics do not report how many individuals work two jobs and are still poor. Real wages haven't risen since 1978. (Pew Research, August 7, 2018 Think Tank)
Trump threatens healthcare and social security, and has cut worker, child, and environmental protections. His administration is not very supportive of life.
Nor is it supportive of large companies, save for the tax reduction to the rich that made everyone else's taxes go up. The rich invested in stock buy backs. Now, Trump's trade wars, tariffs, sanctions, unpredictability and overall lack of knowledge make it difficult for companies to plan their futures, even small companies.
Looking forward to the "After Trump Boom".
15
Remember Krugman's brilliant take on Trump's election: "If the question is when markets will recover, a first-pass answer is never."
It took about 24 hours for markets to recover. I expect this prophecy will be just as accurate.
3
Do you also remember he retracted that?
Paul you know why...They are hunkering down for a Democratic administration. Humans are emotional beings, and they know the party is soon to be over, the lights will be turned up, and responsible adults will return to the mundane task of increasing the viability of Obamacare, increasing minimum wage, re-arming the CFPB, re-arming anti-trust policy, enforcing environmental law, and raising taxes on the rich to pay down the deficit.
Wall Street does not like that. Wall Street wants endless tax breaks for them, less benefits and $7.25 an hour for everyone else.
My real concern is not now. My real concern is just how far will the Oligarchy go to undermine the next Democratic Administration, from the private sector.
For example Paul, could Walmart and Amazon collude enough to raise prices enough to trigger a bad inflation number, and if so, could it be detected? Very curious to know your thoughts.
13
I'm really shocked people haven't taken into consideration what a bad businessman Trump was before he became president. His few successes were offset by his many losses. That style of fiscal management might work in the private sector, but he's playing with our money now.
24
Trump wants to get re-elected....duh. Expect a 'breakthrough' trade deal with the Chinese late this year/early next so Donald can be seen as saving the day. The stock mkt seems to be betting on this as it refuses to go down with all the uncertainty out there.
It is regrettable that Trump could not tell his 'trade war' story in an appropriate way. The Chinese have been ripping off our technology and innovation for years costing the US billions and billions of dollars and jobs. Simple story to sell to the American public but alas nothing is simple for The Donald.
After all the pain, suffering and uncertainty that the 'easy to win' trade war has brought forward I hope that Trump does not cave and walk away with a watered down trade deal just for the sake of re-election....but, duh, it seems likely that his trade war will be for naught.
At one point it seemed Trump held all the cards with Chinese economy feeling the effects more than the US. But Xi seems to be holding all the Trump cards now with impeachment distractions, MidEast turmoil, etc.
1
The reality that Trump and his team are very strange people who have no idea what they’re doing.
So true.
18
@Not Gonna Say
Well, to be honest, it's worse than that... his team is supported by many in House and Senate . This needs to change and change fast or all bets are off.
Vote!!! like your life depends on it... cause it does!
1
The only thing i know for sure about the 2020 election is that whatever we think the primary thrust of the campaign will be now, it will certainly change in the coming months.
If there has been any major lesson to learn from the entire Trump debacle it is that while the short memory of the electorate makes it easy to sweep things under the rug, the real issue is that most voters only have enough bandwidth to deal with 3 or 4 problems at a time. And Trump's primary skill is making sure that he keeps no less than 5 or 6 things on fire at any given time.
The average voters doesn't have the time, or the emotional energy, to stay fully informed about all the nonsense that he pushes through. And unfortunately, complex ideas like how uncertainty creates economic volatility will remain unlikely to be a primary talking point in the next election.
6
My wife and I are the products of parents who endured the
Depression of the 30s
I’m still working at 70 and my wife just retired.
We have seen the damage this trade war has done to our
Family in the Dakotas, crops will go unharvested, people
will feel abandoned by this president who promised big coal
and infrastructure resurgence.
Those who bought in to his great tax cut got little or nothing.
Tell me if his promises have come true?
12
Time and again over nearly 7+ decades I have seen the same pattern of institutional dysfunction ruin families, companies, nations, etc.
Mr. Krugman cites fluctuating confidence levels as a significant indicator of trouble afoot. But as he points out, the validity of confidence can be very shaky when it is not vetted by common sense, and a prudent dose of skepticism. - otherwise,it is likely to be another rainbow delusion, i.e., the pot of gold is in reach!
The potency of that delusion is the foundation of most scams and con games, especially those perpetrated and endorsed by institutional authority; state lotteries, regressive taxation, "trickle down economics"and vilification of critics who count the number of losers it takes to support a few winners.
The U.S. is now engaged in harvesting a bumper crop of losers who've been trained to blame themselves and/or imaginary boogeymen.
8
@Kirk Bready: One has to wait until after death for the fake religion of the US to pay off.
Economic woes become just part of the chorus of gloom; we have a major political party, the party in power, flirting with "civil war" if things don't go their lawless way.
Can we get a consensus in this country on one thing?
Have we ever experienced in our nation's history an active undermining of all we profess to be.
Including economic prosperity.
11
Unemployment might appear to be low, but I know three people now, all in the 50’s, who have been unable to find jobs because they are overqualified, doublespeak for too old. This should be illegal. My twenty-something son spent almost a year looking for a job despite being trained in computers and marketing.
So it all sounds really good - until you really look and see that businesses are not hiring the experienced or the educated. They are hiring the cheap.
18
@Victoria Morgan I went through that about 10 years ago. This is one reason we need at least a public buy-in option for Medicare.
13
@Victoria Morgan
Any job that can be outsourced via electronic communication is disappearing. It's impossible to compete with Vietnam wages and still earn an upper middle class wage.
6
Four our economy to grow, we need to export American goods, but looking at the world this isn't realistic because most countries are slowing down. So, where are the buyers? Also, the Feds are not helping America by dropping interest rates. There is so much money out there it is frightening. And Treasury is buying bonds so businesses can have more money. Nonsense. It would be nice to know how are inventories doing these days, like how many cars are sitting on those vacant parking lots waiting for customer orders. Hopefully soon, the bad numbers are going to leak out of D.C. and maybe some of this economic news will make sense.
7
The economic uncertainty is no doubt an important piece of the electoral pie. But it is a mere subset of the chaos that Trump has unleashed in foreign policy, in environmental policy, and across our government.
One thing was certain in foreign policy was our laser-like focus on defeating ISIS and continuing the global war on terror, But in abandoning the Kurds and withdrawing from northern Syria, we essentially surrendered to terrorists. And on top of that, now the only world leader that demands the attention of every party in the Middle East is Vladimir Putin.
The environmental consensus forged across two decades, especially under Richard Nixon, brought certainty to the regulatory structure in the US. The Clean Air Act, the Clean Water Act, and the Endangered Species Act were sacrosanct, with quibbles around the edges, but generally agreed-upon frameworks in which to protect the environment. That's now in shambles.
But with all that, one would think that business leaders would welcome the constant march toward aligning the economic power of the corporation with the police power of the state, as the Party of Trump advocates at every turn. Maybe the business leaders are looking at Chile.
12
You forget to mention the vast majority of senior citizens who can barely make it on their meager social security checks. I'm not talking about the ones lounging in Florida opening their investment portfolio reports. I'm talking about all the rest of us who watch in horror, depression setting in, as utility prices and food prices and auto repairs go up and up and up and up. Buy a gift for a grandchild? Forget it. No money left at the end of the month. Take a weekend getaway trip? Forget it. Had to fill a costly prescription this month.
14
Let’s not forget the budget deficit, you know where expenses exceed revenue be it Trump/China or public debt our country is on a collision course. Vote Warren/Yang.
6
A POTUS in favor of negative interest rates is like a rocket scientist dissing gravity.
Things can’t end well.
15
@DSwanson But of course this president is no rocket scientist, by any means.
1
We need a new economic measure charting the inverse relationship between what Trump claims, ("I'm the best", It's the greatest", "stable genius), and the realities on the ground. Call it The Bedbug Index.
11
I'm certainly not an economist and I defer to Mr. Krugman's expertise. Having lived through a whole bunch of booms and busts, one thing I believe the booms have had in common is some kind of blind faith and enthusiasm by the general population. One, in particular comes to mind was when I believe America and Americans were just tired of being the blame as the cause of the whole world's ills. I believe there was a resurgence in "American Pride." My buddy (haha) Ronnie was the president and I believe he had nothing to do with the economy improving, but .... The busts have tangle economic reasons. Enter the smartest man in the world.
1
@ggallo "Tangible"not "tangle." Damn you auto-correct, my proof reader, and my lack of education.
You forgot to mention Corporate after tax profits year to date through Q2 are DOWN this year. How are stocks up 20% when profits are down, and valuations are stretched to levels seen only three other times, 1929, 2000, 2007???
11
Unfortunately it's looking like Dems will cast their lot with equally destructive populist economic policies (Warren) on the left that would create even greater uncertainty than Trump's policies have. There's a clear path to victory if only the Dems were smart enough to nominate one of their non-radical candidates.
10
@Keith
Don't confuse "the economy" with Wall Street. And Wall Street's success is not necessarily Main Street's success. Warren would actually be good for the economy of real people.
6
Trump represents the idea that "the rules don't apply to me." He sees himself as an exception, a law unto himself. Many
Americans share this mistaken notion. The idea is widespread that the way to get ahead is to ignore or defy reality and to show the world that you can make things happen. This belief has been sold by a host of hucksters, those contrarians who tell you that the experts are wrong and that the way to win is to violate the accepted norms and rush in where fools fear to tread. We have a lot of "red light runners" in this country, I see them almost every day when I go out for my two mile walk. I myself don't pay attention to the walk signal anymore; I look to see if there are any cars within striking distance before I cross the street. We are a nation (perhaps a civilization) on the verge of a nervous breakdown and Trump's economic moonshine is part of a larger narrative in which "people of faith" imagine they can fly.
18
Until Trump and the collaborating GOP, we had a colorable claim to being a stable nation of laws, which encourages investment. Now, egged on by Putin (whose nation has a GNP less than Italy's), this asset is destroying that notion.
Money follows stabilty, not bullying incompetence and caprice.
17
It certainly shouldn't come as a surprise, Trump is profoundly ignorant and can only abide surrounding himself with family, raised by him, and personally selected embarrassingly inept "yes men" who'll only ever do what he wants and tell him what he wants to hear. This is precisely why he's shielding his tax records so fiercely. If people actually caught wind of his antics as a so-called real estate guru, that would likely be the biggest scandal of them all. He simply is incapable of responsibly managing anything, with him it's all smoke, mirrors and absolutely nothing else.
19
Trump's one talent is creating chaos. As he has said publicly, he makes decisions from his gut. (The last president who did the same was George W Bush, who left a great deal of death and destruction in his wake). Trump has no strong beliefs beyond his insistence that he is a genius, and that his actions are perfect. Combined with his low level of knowledge about the world beyond New York real estate, he is easily manipulated and mislead by Putin and others who are not friends of the US. Supported by the anti-government GOP, he is likely to continue on his chaotic and destructive path, damaging not only the economy, but the government itself, the people of the US, and international relations. Who benefits from this destruction of the world's oldest continuing democracy?
11
"... Trump and his team are very strange people who have no idea what they’re doing."
Paul, that sums it up nicely. The Trump administration is the duck billed platypus of presidential administrations - with a junkyard dog's meanness thrown in. So what will they do if elected again and the economy comes crashing down? I shudder to think.
17
The Trump admin is total chaos in almost every way possible. There is nothing stable there. No good plan for dealing with China, no plan for climate change, no plan to help middle America (farms are worse off), no plan to mitigate privacy concerns, no plan for medicine... And the Republicans are not even doing what they should be good at - conservative fiscal policy.
Its a disaster. The GOP cant even count on Trump to run his re-election properly, even with a ton of money. All things GOP are going up in flames.
14
"As the net closes in, the G.O.P. response is likely to be uglier than you can possibly imagine." How right you are, Mr. Krugman! Trump and Co. are like Nero and the Romans. If the empire is going to burn to the ground, Trump is going to be sure to take everyone with him and guess what? Every GOP enabler deserves what they have coming to them - they will, heaven willing, reap what they've sowed.
12
"One answer...is that... the trade war has created damaging uncertainty."
Although the "stable genius" in the Oval Office assured us that trade wars are easy to win, it is clear that Trump and Novarro are clueless. Their early retirement is our only hope.
10
The reason that Vice President Biden remains ahead in the polls is the general public's graving certainty in their lives. We are all tired of waking up each morning with the market jumping all over the place, a new ethical lapse from the Oval Office, imminent wars all over the planet---it is just exhausting. What Trump doesn't get, is his nickname for Biden, sleepy Joe is exactly what the public wants right now--- some sleep.
8
The Trump Uncertainty ....
And imagine businesses abroad reacting to Trump. Would you make US goods partof your supply chain right now? Or would you better order in Asia and Europe? The US will pay for this stupid policy for many years to come.
Trump's trade war leads to a US isolation. I strongly regret this as I have many friends in and from the US.
8
Well done- hope the voters do the right thing in 2020. Enough is enough- the daily atrocities by Trump, his cronies and family must stop. He needs to loss by a landslide.
8
Since Trump became President, Paul J. Krugman, an erstwhile Nobel laureate in Economics, has been feeding us an endless chain of doom and gloom prognostications -- none of which have yet shown any sign of happening. This is but his latest attempt at terrifying us into hating Trump's policies. One wonders whether he ever was much of an economist or is it just that his limitless hatred of Trump impels him to spew these diatribes.
3
@JJ Gross
Do you read our newspapers? It seems not: endless tariff wars which are causing ruin for our farmers, the largest deficits we have ever seen as a result of tax breaks for the top 1% ,cuts to to all sorts of government programs and people having to work two or three jobs just to survive. This administration is also fond of dog whistles that promote discrimination against minorities with economic consequences. The latest is the attack on our Constitution which has the bedrock of the quality of life here.
2
How fitting for the grifter in chief, Trump, to hire as his trade war czar, Navarro, an economist outlier who creates anagrams in his book to bolster his argument that an all out trade war with China will solve all of our problems. The US's deficit is at an all time high of $779 billion w/ spending at $7.1 trillion & total revenue at only $3.3 trillion. The stable genius keeps increasing the military budget while attempting to destroy the social safety net like the Affordable Care Act, privatizing Medicaid & the VA medical budget, cutting food stamps & Meals on Wheels program.
Since the passage of the "Tax Cuts & Jobs Act of 2017", corporate tax rates lowered from 35% to 21%, the number of companies paying zero taxes doubled from 30 to 60 in year one. According to the Panama Papers many "Trump" companies had fake principals, such as an anonymous woman in Palembang, Indonesia, who fronted as the company's owner for tax avoidance purposes. The "Trump Tower Panama" & others. Trump himself in addition to buying companies, hollowing them out & then declaring bankruptcy, also utilized shell companies to avoid paying taxes.
Steve Mnuchin (the "Foreclosure King", the Treasury Secty, is no better. He profited off the 2009 financial breakdown by buying the failed bank Indy Mac Mnuchin from the FDIC for about $1.3 billion in cash. The FDIC agreed to cover all the Indy Mac loan losses from soured mortgages. He then renamed it OneWest & it magically became profitable again.
10
I see prices rising as I shop best price always
The loss of cheap and quality Chinese products will soon hit US hard
International Corporations are not loyal to US yet are now more equal than any voter
Citizen United Is doublespeak
and now we are all criminals
Lock us up!
6
When will Trump's base wake up and realize that he has betrayed them?
6
A "trade war czar..." One of the most remarkable indications of American decline into authoritarian lawlessness is in the language. The expression "Czar" used to be a symbol of reckless, abominable absolutism. Now it is praised as a macho, reassuring virtue of strength. You need "czars" to fight drugs, crime, war trades, etc. Mind you, you do not need "the law." You need a Czar. This is why Czar Trumph has rendered the USA in a lawless nation. If Americans manage to reinvent themselves after the Trump dictatorship, they will have to learn, as the Germans did after WWII, on the dark subliminal aspects of the language they are now using.
8
Current occupant of the White House has never created any boon. He is the recipient of the slow measured financial progress of the previous administration.
9
Given Trump's wild unpredictability lying
and worthless word, there is no reason for
there to be any confidence in anything he says
or does
6
The only businesses to most certainly benefit from the Trump administration are those with Trump's name on them.
5
Yet, this is certain to lower carbon emissions. May be the best we can do for the fate of humans and the natural world while the GOP exists.
1
To pile on with the bad news, it has been reported that (i) 7 million auto loans are at last 90 days past due, (ii) credit card late payments are at a high not seen since the Great Recession, and (iii) mortgage defaults are rising again.
The overall data indicates a bifurcated economy - the minority "haves" are doing well or at least not falling behind. The "have nots" are continuing to slip financially slowly; tend to think of a "death of a thousand cuts" slowness. For example, incomes barely increase with inflation, yet purchasing power declines with inflationary price increase of ordinary day-to-day consumer goods, interest rates increase slowly, returns on savings remain low and cost for services increases.
Most of the national statistics on US economic performance are averages, which can hide a lot of more important information. One household increasing its average income or wealth can mask a considerable number of other people treading water or losing ground. If you have 99 households earning $60,000/year and one earning $10 million/ year, the average (~$160,000) is the same as 99 household earning $25,000/year and one household earning $13,525,000.
While statistically the average household income has remained stable in these two scenarios, can anyone claim that the majority isn't worse off economically?
5
I look at it from the standpoint of data like linear regression and trend analysis. Graph and look at just about any data like unemployment rate, job creation, the S&P 500 index, transportation, etc over the past decade since the end of the past recession. Almost all the trends show that what Trump claims as economic victories are just a continuation of a 10 year trend or oscillation around the mean. Alas, many trump supporters think the world became all rainbows and unicorns with his election and cannot look farther back. The mathematical illiteracy in this country is breathtaking.
7
In my travels I have been to third world countries where segments of the population live in abject poverty but continue to support the dictator in power. Their rational boils down to "keeping the others out of power." I believe that is the dynamic that will play out in the 2020 election. It will not be about the economy or America's role in the world or about the environment. It will be about tribalism.
9
Business wanted less taxes and regulations and felt they could use this unhinged man to deliver those goods. Social conservatives and Evangelicals wanted conservative judges and supported this very inmoral man. Foreign policy hawks liked his aggressive language and forgave things like his insulting remarks about John McCain. It was true that he said crazy things but it was just rhetoric. Then came the trade wars and the stab in the back to our allies the Kurds and the realization that the Stable Genius really believe he is a genius. This is not going to end well for the GOP. The question is how much damage he will do to our Country including its economy.
9
Future expectations--people vote on the future.
The economy matters, but so do other factors. It might explain in part why Carter lost in 1980 and why Obama won in 2008.
It is a sad time in the United States.
2
Treason in Iran by the Reagan campaign did Carter in. The Republican Party is the foulest swamp in the USA.
1
It should not be a surprise, given an administration whose economic policies favor large corporations and people of great wealth, that the rest of the country is being largely left behind.
For all of Trump's cynical pandering to the "little guy," and notwithstanding the general improvement of unemployment statistics which truly began during the Obama Administration, what we are now seeing is widening cracks in the nation's economic foundation. These fractures are hitting the little guys the hardest, many of whom were among Trump's base of avid supporters.
I have little doubt that as the 2020 elections grow nearer, Trump will begin to throw obvious bones to his core constituencies. But the economy, unlike the stock market, doesn't respond to such news on a day to day basis. Whether voters, now becoming suspicious of Trump, do, remains to be seen.
9
I totally agree w/ Krugman's premises, but think far too much emphasis is placed on GDP growth and unemployment (via the Household Survey especially).
If "real" GDP growth is less than 2%, it may actually be negative (i.e., more than 1% is needed to accommodate population growth... and probably at least another 1% to compensate for under-counted cost-of-living increases).
As for unemployment and job creation numbers, how many net new jobs are perm "breadwinner" positions vs. temp "gig" ones? And why is the working-age labor participation rate so low if the job market is so hot? Ditto w/ wage growth.
8
The only way this Republic can be saved from a Trump/GOP autocracy is if PRIOR to election there is economic collapse (not just a slump). Won't happen by then. The collapse will however happen some time after they've consolidated their violent power grab (almost inevitable in light of their disruption of Congress two days ago). But by then any economic collapse will be too late to have saved the Constitution.
3
The kind of uncertainty created by the present administration, the roving conflicts with our trading partners and the fiscal irresponsibility of the tax cut combine with concerns about climate change and our future as a planet to cause people to stop buying manufactured things and concentrating on purchasing "experiences" or just plain saving. Experiences are single-use products that do not build an economy. Our children are so fearful of climate change that they buy almost nothing at all. The present administration's hostility to the concerns of our citizenry and the imperatives of the bold action on climate change only worsen the uncertainty it has created and people's reluctance to commit to any future at all. In the midst of global warming, many of us are frozen in place.
5
Debt (and there is a lot of it in many places in our society - government, retail, student loans) plus uncertainty equals wobbly. This economy gives no reason to be confident and several really good reasons to be cautious. With so much oxygen in the political space being taken up by Trump's bad deeds and Mean Girl Tweets, not too many administration people are paying attention. And fewer know what to do anyway. In the larger picture though, even a wobbly economy takes a back seat to a wobbly republic.
5
While I agree in general, it is currently true that rates bottomed in September and are edging higher. And clearly the markets are more or less at all time highs. So the outlook is somewhat more optimistic than it was, say, a month ago. But the markets are really still waiting for details of the 'phase I' trade 'agreement', sort of knowing that nothing is really going to happen and ready to head for the exits. The trades are crowded.
1
Paul - thanks again- incidentally, are Nobel laureates as above the law as presidents, according to Trump’s lawyers, anyway - I’m wondering if you get to commit murder on 5th Ave. without arrest, the way he insists he can.
Aside from the aside, how long will it keep the average unemployed or underemployed citizens to realize they are without good jobs because of Trump and not a few folks who want to call this nation home but don’t have perfect pink complexions or claim the right, in more than one sense of the word, faith?
4
Maybe it is time every voter starts looking at more than how the economy is doing when it is time to vote. Trump is a one note Johnny and it is time to require a more substantial President who knows how to run the country.
This is what happens when you bet on money instead of character. Betting on money is like a horse race. Character is what brings stability, which we need more than ever.
3
The next election won't be about facts. It will be about who has the most money for the media and internet buys with which to create the perceptions that will drive the voters. You can point out that high debt levels and inequality are crushing us, but it will be answered by scare mongering about socialism.
It will be about who has the most power to bend facts into alternate realities.
trump and Barr beat the Mueller Report by lying about it. They have no reservations about using the entire Executive Branch to create whatever reality suits them. The rumored criminal investigation of the Mueller investigation is just one trick in a bag full of them.
Unless they are hauled in by the short chain of impeachment, election campaign corruption will continue.
12
The tax cuts created more uncertainty. People thought they were getting larger refunds than they did. Most people got lower refunds than normal, which to them means they are paying more tax than before. Demand fell because instead of the large refund they normally got and spent, they got a slim refund, or the horror, paid in. Even if they overall paid less tax than the year before it was so little, and spread out so much over the year that they did not feel it.
1
@Zelda Bee
Let's see, tax policy is the subject. How does it affect me? I'll answer that, living in a state where property tax is fairly high but thanks to Trump, my income tax deduction is capped at $10,00 when the total property tax is $12,500. The effect is "raising my income tax." I'm positive Trump didn't run on raising taxes ala Walter Mondale 1984.
The deficit has dropped off the radar of Republican issues.
10
Paul we have been seeing a variation of this claim, that the economy is crashing since there was a hint that Trump would win and we here it daily when any social programs are presented by Bernie Sanders, only slightly less so when presented by Liz Warren. Let’s have an adult conversation, The Fed, not the President has been the more important “decider” about what direction the economy will go in and btw the last decade of zero bound rates has all but decimated small middle class savers while fulfilling its real job of reinflating asset bubbles in both stocks and real estate primarily for the benefit of the wealthy investors and hedge funds such as Blackstone and Blackrock. The decades of cheap money has been promoted by both parties Paul it’s not a Trump thing, until we go back to a currency backed by something other than IOU’s and away from a rigged “ free market” we will continue to lurch from one bubble to the next bust, until that is the Blackstones and Icahns have all the chips, then we will enter a seriously dangerous time, beginning already in many parts of the world.
5
@Ted We have already entered a seriously dangerous time here. And we are who spread it to the rest of the world. Our people are suffering from lack of income, racism and other forms of hatred. There are indications that trump and his buddies are loosing their grip.
@Peg Our people have been suffering for forty years or more, the middle class has been eviscerated, ask any young person without an advanced degree and until we get over this “it’s all a Trumps fault” and face up to the fact that it has been both sides ignoring the majority as they bend to the will of their mega donors for decades: this is not a Trump thing, this is not a Republican thing, This is not a Democrat, thing this is a highly choreographed effort by wealth elites from both parties to create a government that allows them to amass untold wealth at the expense of the middle class taxpayer; this has been an extraordinary scam run at the highest levels that has allowed financial policy to be dictated to benefit the few at the expense of the rest, it has been a scam that has allowed foreign policy to be dictated to benefit special interests, we all know who they are, it has been a charade that has allowed the fleecing of American taxpayers and increasingly the stealing of the nations assets through privatization, there is little difference between what has transpired in America in the last fifty years and what transpired in the Soviet Union as oligarchs stole the country blind: sorry Peg, I’m no Trump fan but nothing will change until we start listening to some of our greatest minds like Thomas Piketty and Noam Chomsky and ignore “ economists” who are now little more than political hacks backing elite neo liberals and neo cons.
@Ted A lot you say here I agree with as your comparison to Soviet Union. But not all. I compare now to Hitler's doings prior to wwII. Agree also that there are some on dem side who love money. Do not agree that the answer to what is going on now can be fixed by just finding the economic answer.
Will we EVER admit the truth about the US economy?
We've been changing metrics for various statistics since the late 1970's t make things look better.
The plunge protection team at the NY Fed has been jumping into markets at 3:30 to prop them up before the close.
We're living in a Potemkin Village and have been for a few decades. Unemployment has been over 20% since the2008 crash. Inflation is running at double digits in major metropolitan areas. GDP has been negative for years.
The TRILLIONS wasted on the neocon dream of American dominance in the Middle East has hastened the implosion of the US.
All the US manufacturing sent to China has boosted their GDP by BILLIONS (if not more) and hastened China's rise to world dominance.
I am at a loss to explain the insanity I have witnessed over the past two decades and wonder how much longer we can keep postponing our day of reckoning.
9
Back in 1974, wise people were observing Watergate would never have gotten traction, in a good economy.
3
"A new CNN poll finds that Americans...believe by a margin of 61 percent to 31 percent that world leaders don't respect (Trump)," writes Jennifer Rubin in WaPo.
Scanning the overseas media, the ratio is probably more like 80% to 20% among foreigners in general and 98% to 2% for those in leadership positions. There is hardly any respect for Trump outside of the US. People laugh or moan when he appears on TV and foreign leaders play him like a toddler.
In other words, reelection of Trump will act like a huge wet blanket over the entire world (except Russia) smothering any hope for less economic uncertainty, more sanity and freer trade that the world will simply slump into a dark recession.
16
Paul,
We saw a hint of the coming problem when the Repo market froze up because Federal debt is crowding out the overnight debt financing market.
And, the solution. The Fed will buy more debt on to its balance sheet, something it started as a temporary measure in 2008, the last time the Republicans collapsed the economy with bad management.
So, get ready.
It won't be pretty, and, Pubs will blame it all on Dems.
8
I agree with your comment about how bad things could become regarding Republican efforts to re elect this guy. I’m very worried about Election Day disruptions at polling places in blue/purple districts. Autocrats are not above that.
16
One day, the stress, bad diet, and lack of exercise will catch up with Trump. That might be the only viable exit plan the GOP has from this nightmare.
20
The sad reality is that Trump will run on his "incredibly great economy" even if the economy tanks. Lying hasn't been a problem for him.
32
Yet another column that centers on Trump. He is just the president, and as you have often written, a president’s influence on the economy is doubtful.
What do you think the impact of the media’s obsession with Trump is?
8
I too thought a president’s influence on the economy was negligible. Until this one sabotaged the US economy.
What do you think the impact of the media’s obsession with tRump is?
7
I am increasingly frustrated with the constant hypocrisy of the GOP and the media about the deficit and incredible tax breaks for billionaires that do not trickle down.
While the GOP is not held accountable on anything, it turns out there is a field day (orchestrated by the GOP and Fox state Television) where Ms. Warren is now under constant attack for her Medicare for All plans.
America should be discussing why the need for access to affordable health care should be the nr 1 priority to make life better for ordinary Americans. Once you've established that the voters can decide how much it is worth to them.
Ms. Warren makes brave choices, and they will cost the tax payer money (and it will likely save them a lot more). Almost everywhere in the western world health care has been organised successfully this way. It is America that is the outlier.
I wish the media stop asking the dumb question "who is going to pay for it", and instead organise a dialogue that paints a more complete picture of health care than just costs. Just ask anyone that has gone bankrupt over medical bills what matters most.
Trump clearly has no clue. And the GOP cannot be trusted with your health care (or anything for that matter).
38
“Who’s going to pay for it?” Who’s going to pay for the tax cuts? Republicans always claim they pay for themselves. Isn’t that the Laughable Curve?
2
no mater what the experts might say a Trump core supporter will vote for Trump no matter what, what drives them is not the economy but the hatred for those that they seem different
29
@Rober I believe it is a combination of the two. I know many "normal" (non-racist, kind, well intentioned) Republicans who nonetheless buy into the economic fiction. They don't hate Mexicans; they hate taxes.
2
The fall of the American Dream of Democracy is all encompassing. If Trump wins re-election then the the dream dies. His defeat will give it a 99% chance at revival.
13
The difference between "big business" confidence and "mom and pop" confidence must be considered. The little guy has minimal access to the hedging instruments available to corporations; most lost their confidence long ago, even if they had marginal connection to a Chinese supply chain.
8
I have never believed that businessmen rather than politicians should run our government. A constitutional democracy is not a for profit business despite the fact that corrupt politicians want it that way. But, whether or not a businessman rather than a career politicians runs the country is a forgone conclusion, I do believe that the businessman that runs our government and country should at the very least be a successful one that hasn't bankrupted every business he ever touched. It was painfully, abundantly clear that Trump would bankrupt this country. What was not so clear but is becoming clearer every day was that the bankruptcy being wrought by Trump includes in large part economics but is so much more. America is becoming bankrupt in myriad ways and the only hope is to rid ourselves of Trump, McConnell and the GOP. Vote!
42
Businessmen like Trump are accustomed to running their little empires like dictators who don’t need to consider the opinions of others. Government is designed to thwart dictators and requires dealing with equals and compromise to work.
Time and again we have seen him try to bluster his way in foreign relations like he did with contractors only to be rolled by those smarter and more experienced than him. “Little Rocketman” can now do pretty much what he wants.
3
I have to say, the "Ron Vara" thing comes as kind of an anti-climax. Yes, it's kind of odd, but only a little. From what I've heard, RV was only referred to for brief little cliches, anyway, not actual information or serious analysis. Pence is a lot more disturbing to think about...
9
By traditional historic standards fiscal and monetary policy is extraordinarily stimulative with unemployment at less than 4%.
Low unemployment may not be Trump's friend in 2020 but given the enormous fiscal and monetary stimulus, that is a hard sell to objective economists. The wonder is that demand is growing so slowly with all this stimulus. Krugman is grasping at slight evidence where his wish is father to his thought.
1
Dr. K,
I hope we can avoid an economic contraction BUT there there have been 3 initiatives that have increased financial and macroeconomic instability. The initiatives, which were wrong headed were:
(1) the Tax Cut which could have been a means to improve income distribution and concentration of wealth, which continues to slow the economy. Rich people do not invest in broadly shared innovation;
(2) attempting to unilaterally change the balance of trade with tariffs. It was a failure as you have written about many times. It was the wrong way to address trade issues that we felt that we had with China and the resulting trade war has been costly to American pocketbooks creating a new level of financial insecurity and uncertainty in international trade that has slowed global economic growth. There are some real economic problems that have resulted from the macroeconomic instability that are not easy to solve and a lot of people are suffering as a result;
(3) we were finally beginning to make progress in health care, when the G.O.P. and the Trump Administration have made a well documented effort to make the problem worse. It makes no sense.
To cut to the chase, this administration has been disastrous for most Americans, and I hope that we can show the American voters, how bad the policies were. I keep envisioning one of those interactive maps that show the economic damage done in each of the Congressional Districts, before the Elections, so that voters will know the truth.
22
Number three: the press is so busy following the crime scene, it’s neglected the health care story. In whose interest is it to re-disenfranchise citizens from good care? Recalling the rabid republican hatred of providing health care to Trump’s own base.
Yes, cutting corporate taxes by one-third and giving median families $900 to spend, all on their kids' credit cards, did wonders for the economy in 2018, raising GDP growth to, well, the same level as 2015 at 2.9%.
And now the reckoning...
1. Budget deficit in FY 2019 up 60% vs. CBO forecast when Trump was inaugurated, at $1 trillion instead of the $600 billion if we'd stayed with Obama's policies.
2. Nearly 2 million more uninsured since 2016, with 2017 the first year with an increase since 2010.
3. Job creation faster in Obama's last 32 months (7.2 million) vs. Trump's first 32 months (5.5 million). It isn't even close.
4. Stock market up 44% at this point in Obama's presidency, vs. 31% under Trump. Yes, the stock market was recovering under Obama from a big crash, but he also didn't cut corporate taxes by a third. Almost no stock market progress since January 2018 peak.
5. If forecasts for the quarter hold up, real GDP growth in Obama's last 11 quarters of 2.6% will be the same as Trump's first 11 quarters.
6. Pointless tariffs have nearly offset the entire benefit of the tax cuts for the median family, if implemented as promised.
7. Manufacturing job creation has stalled, with an average of 5,000 per month in 2019 vs. 22,000 in 2018.
The Trump as economic savior narrative is just another one of his 10,000+ lies, repeated in an endless loop on Fox News and other fake news outlets.
39
See: https://climateandsecurity.files.wordpress.com/2019/07/implications-of-climate-change-for-us-army_army-war-college_2019.pdf
Trade wars, failed tax cuts, self-dealing are all bad things, but comparatively speaking, these concerns are the small stuff.
Our vulnerability to the effects of the climate crisis and ongoing environmental collapse is off the agenda for the President and Republican congress. One of many, many threats not being addressed: the fragility of our power grid, which is being increasingly stressed by the demand for more and more air conditioning. Another: increased risk of epidemic disease. Those are only a couple of the laundry list of challenges facing us at home and abroad. See the link above for a look at our uncertain future from the point of view of the Army. The study suggests that the military itself could collapse under the stress of climate change.
Trump's real "high crime" is climate change denial and the promotion of fossil fuels.
26
@writeon1
I truly think you are missing in your comment the wanton destruction of the agencies rules and guidelines put in place to protect us from poor business practices.
The reason government had to create these agencies rules and guidelines was and is business has no interest in protecting anything other than its profits.
Now we are witnessing the destruction of what we say we hold dear. I had hoped for better even though I never thought Mr Trump would be a good or even a somewhat effective POTUS unfortunately my fears were realized.
Just an old white man's opinion.
1
I'm a retired locomotive engineer. I haven't been back to my home terminal in three years. Today I got caught in a traffic jam so I went to visit the guys still working . Talked to a couple of train masters up in the tower. There are over 80 people furloughed basically because no grain is flowing through the terminal to export to overseas. ( you can surmise to whom), Is this how you " make "America Great Again" ?
This is not working. When Trump and his minions spend more on farmers than the Obama car bailout something is wrong. I'm just an X working guy but I know when something in not right!
114
What boom Paul? You have constantly said that there would be economic stagnation and decline once Trump became President. Have you changed your mind and now claim that the economy did well the last three years? Can you tell us any long period of economic growth that did not end eventually? Would the economy have done better if Hillary were President?
6
@Richard Wright
I am quite certain we would all be doing better with Hillary as president.
We would be taking action on climate change.
We would not have a tax cut for billionaires and corporations, we would not have health care for millions at risk.
We would not be watching the evisceration and corruption of our government.
I could go on, but you get the picture.
Hillary's "corruption" was amplified by years of right wing drumbeating. Trump is the real deal.
7
@Tom Wait
Not everybody has 401K's and stocks.
Most people live paycheque to paycheque, which you'd know if you came down off your ivory tower once in a while.
Us plebes have been in recession for 35 years, these times are no worse than any others, and Trump is reducing competition at the low end of the labor market and finally putting tariffs on some imports. I and everyone I know could care less about business confidence, if someone somewhere is worried about the bond market who cares, different world. Not a Trump fan, just adding a dose of reality so you won't be so surprised.
8
Nothing Trump is doing is going to help the poor and working classes.
1
Just when you thought this presidency couldn't get more unimaginable we find out even cabinet members have imagined friends! Trump had an imagined "john barron" calling the press for him as a business man and just when he needs it, imaginable heads of state or even boy scout leaders call to praise him in imagined conversations. Goody, goody we really are in the twilight zone...I'm sure very soon that giant rabbit Harvey will walk right out of that great Cary Grant movie and explain all for us!
18
It wasn’t Cary Grant. It was James Stewart.
2
@anjin
Boy, we really are in the Twilight Zone if Carey Grant was in Harvey. Because, somehow, he magically replaced Jimmy Stewart in the title role.
(But thank you for reminding me of Harvey - it WAS a great movie.)
3
Jimmy Stewart
2
The big business good ol’ boys network that put Trump in office doesn’t quite see the problem as Professor Krugman does. They may know (know is in italics) about the China trade war, the pesky looming recession and that there’s still too many regulations. They simply don’t care because they can just tuck themselves into their mansions and count the money they saved on the tax cut.
Trump’s crony-phony business people (who evidently need to make up fake experts to highlight their poor insight) will still vote for him, as will the deplorable bunch, the rally-goers, the family farmers, and all the rest of the Trumpian dolts.
All these folks have convinced themselves they’re doing just fine, or, the guy that’s above them is doing just fine and maybe they’ll get up there with him soon. And, if they happen to lose the family farm because of the China trade war or the country suffers a worse recession than the last, well, that’s Hillary’s, Obama’s, Biden’s, socialism’s (Pick one or add your own) fault.
19
"At every stage of this process, Republicans have proved willing to engage in stunningly bad behavior. Did anyone foresee Wednesday’s physical attempt to disrupt the House inquiry? The point is that as the net closes in, the G.O.P. response is likely to be uglier than you can possibly imagine."
And just now, the DOJ lets it be known that it has opened a criminal inquiry into the FBI/CIA/DOJ personnel who opened the Russia investigation into Trump. THIS is uglier than ugly, and dirtier than dirt. CONSTITUTIONAL CRISIS, anyone?
37
@William Fordes: Bankrupting people with litigation is Trump SOP.
Note that despite all this, Trump still has a 40 pcent approval rating.
10
@Norm Vinson
A 40% approval rating is not a good thing. No, not at all. Trump's approval rating, I don't think has ever reached the 50% mark.
We have to remove him from office via impeachment or vote him out in 2020. He has broken the law enough times to deserve it.
2
And so we get to observe one more instance of the Laffer curve being one big Laugh. Even Dorothy would recognize that the tornado of Trump would cause more destruction to our Economy than the sub-prime and dot.com crises combined. There is no @realdonaldtrump. There is nothing real about him other than his cowardice. He is a Twitter-Wizard full of huff and puff and empty results.
18
Here is the biggest denial, krugman’s take on the Trump economy. We have record low unemployment, especially among minorities with low inflation expectations. Surely the professor knows he is engaging in petty sophistry when he misinforms readers that high long term bond yields signal high growth expectations. When the economy emerged from the wreckage of the Carter administration the long bond hit nearly 15 percent, hardly on the basis growth, just inflation. What a pity this paper cannot find an opinion columnist whose basis of selection is not a blind adherence to distortions to smear the President in the name of politics. There is plenty to criticize Trump for, engaging in this sort of “analysis” says far more about the author than his subject.
3
@michaelf He said what you said. That unemployment is at record lows. That the economy is still growing. What he took note of is that the economic GROWTH RATE is lower.
And that there are the rumblings that the current expansive part of the economic cycle is nearing an end, and a contractive economy will be next.
Read this part again:
To be fair, the overall state of the economy is still pretty good. Unemployment is very low and job growth is continuing. And while there will eventually be a nationwide recession — the business cycle has not been abolished — it’s not at all clear that we’ll have one before next year’s election.
6
You and dr k are both correct about bond yields. We are currently not in a period of stagflation (as we were in the 70s). Consequently, the bond yield drop (and more importantly, the yield inversion) does indicate recessionary expectations.
1
@michaelf And how about that growing, "huuge" trumpian national deficit...
Yeah, yeah, yeah, impeachment, Ukraine, blah, blah, blah. As yesterday's storming of a classified hearing facility by Republican congressmen shows, Trump and his minions are putting all their eggs in the defeat-impeachment basket. But a small, still voice (of James Carville, that sharp political mind, back in 1992) whispers: It's the economy, stupid.
6
Ron Vara swears there was no quid pro quo.
7
Liberals need to get it straight:
There will be no recession before the 2020 election. So, put down the negronis, stop waiting four hours for a selfie with Liz, stay off the couch and vote for whomever the Democrat is on the ballot.
Even if there was a recession it will have no effect on Trump's re-election chances. It will not swing ANY 2016 states he won to Democrats. It will not swing Ohio or insure the so called blue wall states go blue.
Here is a chilling thought for liberals:
Trump could lose the blue wall states of MI, WI and PA in 2020 but if he wins MN, which he almost did and is the state that did poorest for Democrats in 2018, he gets to 270!!
5
@Paul: The Electoral College is the number one atrocity of liberty to enslave still standing in this land of mountainous unfounded conceits. It should not matter where one lives for one's vote to count in the election of the only US public official representing everyone.
12
I love the photos that always accompany bad Wall Street news articles. I could watch terrible people who make a profit off of the exploitation of oppressed people all around the world go broke all day long.
Like, if there was a movie 3 hour long that was nothing but photos/video snips of day traders and hedge fund managers going bankrupt set to the soundtrack of The Departed I would never need to watch another movie again.
7
Fool me once, fool you.
Fool me twice, fool me.
Fool me again and again and again, I'm a Trump voter.
37
Fool me once, fool you.
Fool me twice, fool me.
Fool me again and again and again, I'm a Trump voter.
9
The election can't come soon enough because we can't be rid of Trump and his coterie of crooks and cronies soon enough.
7
If the economy goes south next year, Trump, his party and Fox News will blame it on "liberals." And his base will eat it up.
9
They certainly didn’t have any problem blaming Obama for a recession that started before he was even elected.
1
@Bob
Don't forget the bad advice from his military advisor, Col Sanders.
1
When it comes to reading the tea leaves of economics and their impact on the political scene the Doctor is always in at the NYT. If you want another take on the situation, I recommend the works of the great Italian money guru Dr. Ragu Plukman. Grated parmesan is optional.
1
@Girish Kotwal (who is fond of English sayings popular in the empire of glory and its commonwealth)
I don’t know if you learned your English expressions in India or in Louisville but you clearly are clueless about what brought out this “boom.” If you cut taxes of the rich and corporations (sorry they are not people like some people from your party believe) by huge margins, the discounted of future earnings, which is called share holder value (stock price for long) goes up artificially. Pretty much as a function of the tax rate reducing the denominator.
Very soon reality catches up with financial engineering and first deficits grow, services are cut and it starts hurting the common folk! I don’t know what you are but let’s assume middle class. You will be hurting and if you or your loved ones get sick and you have lost your job because of the recession that arrives when you just are not expecting it, good look! And hope you are in good health because there isn’t much insurance coverage for unemployed or failed small businesspeople and their families.
Now go back to your English adages book and see if you find something about alchemy.
9
Girlish is a typical Trump supporter: a loser who thinks supporting Trump makes him/her/it a winner. All it takes is buying into the con.
1
When I read that Navarro had an imaginary friend, that apparently writes books, that Navarro purports to be facts. In reality it’s the voice in his head that he’s hearing, and whats worse, he’s responding to it, I wonder if he walks around the west wing muttering does anybody hear that voice.
And that voice is giving Economic advice to an already unstable orange embarrassment that inhabits the Oval Office, and that should bother all of us.
5
trump will be removed by the Senate. Nancy Pelosi will put impeachment testimony on national TV until the polls are so overwhelmingly in favor of removal and barring trump from holding another office that Republican Senators will have no choice.
10
It remains to be seen what else gets broken in the next year, whether Baby Donald can pull together enough votes to keep his show going, what sort of nastiness he'll cause if he doesn't. If the Senate doesn't support impeachment, uncertainty will continue for another year, possibly five, depending on how 2020 goes. Allies and foreign businesses are having trouble trusting the volatility of our current politics. I imagine this effect will continue for a while. I mean, who knows whom we'll put in charge next?
China's century, maybe?
8
For Trump, it's never been about the economy. Why should it be? The tax re-write gave real estate investors (which he ostensibly is in his day job) enormous new benefits. His hotel on Pennsylvania Avenue is booming. His daughter and son-in-law are making out like bandits running their businesses out of the West Wing. He's got an AG keeping him one step ahead of the law. The federal courts are loaded with Federalist Society grads, all of whom have pledged fealty to him.
And the evangelicals love him for sticking it to the (liberal) man who happens to believe in the rule of law, mutual trust and respect, and empathy. Besides, they've got reproductive rights on the run, and a sympathetic Supreme Court ready to decide that a President is above the law.
So, no, he has no reason to worry about the economy. He never has; why start now?
28
The most important evidence regarding business confidence has been reported daily for a week or so. It’s earnings season and every major company is reporting its earnings for the last quarter and predicting its earnings for the next quarter. It behooves companies to predict responsibly. Predict too low and the market punishes you. Predict too high and you’ll pay the price when you fail to meet expectations.
It’s been a good earnings season. Lots of companies have exceeded expectations and are optimistic about the future. Confidence is lifting the market, which has done quite well this week.
The economy could collapse tomorrow. But that isn’t what this article about. This article is about business confidence. And for a week the Times and every other newspaper with a business section has been running stories that provide compelling evidence that Krugman is wrong. Krugman chooses to ignore them. What is he thinking?
2
It's the uncertainty, stupid.
11
@Alex
Are you sure about that?
This is weird. I find myself hoping for an economic downturn. Just enough to rid our democracy of Trump. In the long run it would be worth it.
I suppose this is the exact opposite point of view of many wealthy Trump supporters. They seem to be willing to endure Trump for some short term financial gains.
18
@EPB I not only hope for an economic downturn to get rid of the criminal Trump and save democracy, I do everything in my economic power to help it along. I"m a vegetarian so I don't need meat from struggling farmers. I have a "Victory Garden" to provide my family vegetables. I am delaying all major purchases until Trump is gone, one way or another. For smaller items that I need, I either buy second-hand - Tucson is the used goods' mecca of the world so it's quite easy to do that here - or I buy things "Made in China," or Vietnam or Thailand or anywhere but the USA. I bought a Belgian vacuum recently even though the vacuums "Made in America" were on sale...democracy is not for sale as far as I'm concerned. #RESIST
1
The fourth industrial revolution we are in, the social status is not what it use to be. So, people are not borrowing money beyond their means to create a false social status. For example, to make autos more affordable, 7 year auto loans are created. Yet auto sales are dropping. Also, after the deep recession of 2008, a large segment of the population is either recovering financially and/or becoming savers, and getting old. Furthermore, with wealth accumulating into fewer and fewer hands, the number of consumers in the business of luxury goods and services is also dropping. Besides, the business of luxury goods and services do not produce manufacturing jobs. The current state of the economy is by and large a result of what happened in 2008. Trump made it worse with tax cuts, actually it is Paul Ryan that made it worse, Trump wouldn’t have cared either way. We may or may not have a recession before 2020 election, but Trump will not be the catalyst for either direction. The election will be decided not by recession but by economic justice.
2
Incorrect. “total U.S. consumer debt hit $14 trillion in the first quarter of 2019, surpassing the roughly $13 trillion of leverage accumulated in credit cards, auto loans and mortgages and other debt back in 2008”
3
@Norm Vinson
That comes from population growth of about 8% over the decade, so 13+1.04 = 14.04 trillion.
Good point, but spending is not dropping that much. Though there is inflation that is not accounted for by looking at raw $ amounts, so on a per capita AND inflation adjusted basis, debt HAS dropped, but it’s not a whole lot.
1
I think it's not just the uncertainty that's dragging on the economy, but also the slow realization that we're just not that great anymore as a nation. It's dawning on people in business and finance that the rise of a man like Trump, an obvious con man, has undermined confidence in the country's reputation as the world's leading economy. What initially seemed to investors and business people to be a perfect alignment of deregulation, lax oversight, and tax rollbacks has become an enviroment where future market growth looks dismal. Opportunity is limited, cynicism doesn't work as well as genuine and realistic hope that we're moving in the right direction, and consumer confidence is better when the government actually works for people, not just corporate bosses. How we feel about ourselves, personally and as a nation, really does have an effect on how the economy runs. Who can feel good, or proud, or optimistic about ourselves or our country with this band of miscreants running the show? Maybe I'm projecting, but I can't help thinking that business people are finally finding out that having everything you want is not all it's cracked up to be. Shared prosperity is what made this country great, and now we're just a bunch of grubbers, and it doesn't look to get any better for the vast majority of The People.
34
Unlike Prof. Krugman, the president's supporters do not vote on the basis of econometric statistical projections. They vote on the basis of tribal identity. The vicissitudes of the business cycle will not alter immutable tribal identification.
14
@Robert M
Except when their health insurance gets cancelled & they die
Trump claimed that he inherited a disaster from Obama. Well, private sector employment matters. Growth in total private employment over Trump's first 32 full months in office lags well behind Obama's last 32 months in office by almost a million jobs (see BLS CES 0500000001).
If Obama was a disaster, what does that make Trump?
11
umm ... bc we owe a lot of $$ because of the Bushco Oil Crusade?
that we pass on to the kids w/out accountability?
7
Why?
fear mongering from the media
every day, editorials designed to create outrage and fear.
3
A first pass answer on when the economy may recover is never - Paul Krugman, Nobel laureate
5
Trump is such a crook that MAGA now means something different.
MAGA
Make
Attorneys
Get
Attorneys
20
Is it time to give Trump the Nobel Peace Prize yet?
5
The world economy runs on a knife edge of growth....growth...growth. Any perturbation can send it spiraling down too fast. With all the conflicting interest across the planet, each economic strategy should be vetted to ensure long-term viability. It essentially never happens.
Trump is the odd wildcard that should never have been put in any position of making economic decisions. His record is awful and his supply chain knowledge is non-existent. The GOP economic has pushed all aspects of debt to unsustainable levels. Fear the next perturbation...
Anyone else have Leon Russell’s song “Tightrope” in their head?
7
Why has business confidence collapsed? Consider that there might not have ever been a boom. Trump does not care if business does well, only if HIS business does well. Sure there were lots of "great" statistics put out by USG agencies headed by people who wanted to prove their loyalty to the Don. Those statistics have been restated for the worse without fanfare some months later. Anybody relying on those statistics has likely made some poor decisions in the last couple of years.
This devastating situation serves as a lesson in why our high school students need to know data-based math, not pre-Eisenhower algebra 2 and calculus. They need to know how to manipulate spreadsheets, understand data reliability and especially the distinction between correlation and causality.
Meanwhile Trump has appointed a person committed to underserving all who are to be educated in public schools...
Thank you to Jo Boaler and Steven D. Levitt for starting this conversation about math education. No thank you to Trump who has made it necessary...
35
Thank you Paul for a dose of reality while the Trump administration creates counter conspiracy drama to distract us all. Impeachment is real. Failed economic policies are real. The common denominator is Trump. The economic impacts are where reality breaks through the facade and we realize that once again the GOP is going to leave a train wreck of an economy. The one good thing is that this is just in time to help remove more GOP from our assemblies in states like Wisconsin, where GOP policies continue to work against the people for the sake of private interests. If there is a silver lining in this cloud it will be that the GOP will be out of office in larger numbers so that we can address the deep structural problems of this gilded age of corrupt corporate control of government.
15
No one wants to talk about it, but it's hard to have economic confidence when the country is absolutely awash in debt. National debt, annual defecit, student loan debt, even new car debt. Did I mention credit cards? It's getting harder to sing "Every day in every way, better and better" when you know in your heart the piper's going to demand payment and there's no money in the bank. That'll only get worse if Trump (shudder) gets 4 more years, but I don't see a lot of fiscal responsibility on the Demcratic slate, either.
688
@OldPadre - I find it interesting that the press and Republicans are clamoring about how Warren or Sanders will "pay for Medicare for All".
Nobody raised too much objection when Trump and Mnuchin declared that Trump's "Tax Reform" and the $1.5 Trillion handout to the 1% and corporations would "pay for itself". Nobody seemed to require that Trump explain exactly how that would work *this time*, when it has not the last three times Republicans tried it... but now they all demand to know exactly how Warren or Sanders will pay for their MFA plans.
It would serve them all just right if Warren or Sanders said "MFA will pay for itself!" when asked. And, actually, there might be a shred of reality in that... considering that every other advanced country that has a single-payer plan spends massively less GDP on healthcare than the current USA healthcare mess.
601
@OldPadre: we've been hearing these warnings of doom on the Democrats fiscal irresponsibility and being "awash" in debt for going on 50 years now. It's getting old. And even if it is a problem, it's a problem which would be easy to solve -- stop letting the military-industrial complex stop dictating policy to government. Eisenhower really nailed that one sixty years ago. Seriously -- when a country constituting 5% of the world's population insists on spend more on "defense" than the rest of the world combined, then you know that fiscal "responsibility" is not and never was a real priority.
273
@OldPadre
Wages flat for decades and you want to talk about fiscal responsibility? Try talking about the theft of the middle class!
245
I am sorry professor K, I cannot believe a word you say, I wish I could, the powers that be have shown themselves just too powerful to let their party end.
Therein lies the problem. Objective facts and data, which I think Dr. Krugman uses in good faith to make his arguments, don’t matter. The only thing that counts is your subjective belief system, which is apparently not guided by or subject to the kind of information thinking people have to use to navigate the real world. Everyone has a right to their own opinions. When those opinions are based on flawed data (or no data), bad things usually happen.
5
@Julie
How wonderful to be fact-free!
PK is what Trump lusts to be and never will be: A Nobel Laureate.
That great thing about Krugman's argument is that his FACTS are 100% verifiable and verified.
You're entitled to disagree with his analysis, with his interpretation of his cited facts. You're not entitled to claim because you don't like them his facts are false.
PK doesn't have secret sources. He's working from easily available data.
Hope the Kool-Aid was delicious!
6
@Julie Take heart. There's only so much blood one can extract from a turnip.
GOP 2020: Protect and defend American from
1. Affordable health insurance
2. Affordable higher education
3. Infrastructure jobs
4. Increase to the federal minimum wage
5. Coherent trade policy
6. Election Security
7. Living wages for teachers
8. Closing tax loopholes for millionaires and billionaires
9. Price competition for Medicare drugs
10. Clean air and water
135
@Eric Carey very concise and a reminder that a good economy depends on the health of society as a whole, not just a banker's daydream of deregulation.
39
@Eric Carey I would only add tht the GOP agenda likely includes: in case anything goes bad, focus on immigrants and Hillary Clinton as the cause instead of Trump and the GOP.
17
I recall approximately three ago another editorial by Mr. Krugman that predicted the demise of the US economy because of the election of Donald Trump.
That didn’t happen.
Maybe it will happen this time. But we should realize that economics is not a real science, it’s an elaborate system of opinions. That is coupled with trying to predict the future. Caution and skepticism are in order.
5
@Mij Sirron I don't think that was Krugman's prediction at all. Just the opposite, if recollection serves. I believe his prediction was that the economy would perk along until sooner or later the incompetence factor kicked in. As it is.
38
@Mij Sirron
You say the same things about a weather forecast.
1
I wish more people (and politicians) understood how dangerous uncertainty is. Do they confuse risk and uncertainty? They’re completely different. Businesses are well equipped to handle risk, where outcomes and the odds of those outcomes are reasonably well known. There’s a reason we call things a calculated risk. But uncertainty changes the picture entirely. With uncertainty, you know neither the possible outcomes and/or the probabilities. Of course it brings investment decisions to a standstill.
23
Until, and unless we abolish the electoral college,impose term limits on Congress, and establish federal funding for federal election campaigns, without private contributions, we will continue to have the best Congress that money can buy. Recent history has proven that true for POTUS, as well.
21
@jljarvis
\
AGE LIMITS, not term limits.
Term limits won't work. Age limits will.
Regressives would be happy to know that with age limits, there'd be no Warren, or Pelosi.
1
@jljarvis: "Until, and unless we abolish the electoral college"
The electoral college was and still is a great system. Unfortunately it has been hijacked by both Dems and Repubs at the state level in 48 states.
"...impose term limits on Congress..."
Wholeheartedly agree. If it's good enough for the President it's good enough for Congress. Alternatively, we could eliminate term limits for President and abolish the 17th Amendment.
"...establish federal funding for federal election campaigns, without private contributions..."
Disagree there. I don't want the government to divide up my tax dollars equally among two corrupt party's candidates. Besides, what if I don't like any of them?
1
@matty
Or Trump.
1
Uncertainty. That is that is the question. Uncertainty is the answer.
Consumers don't make large discretionary purchases if they think the world in going to blow up. Businesses do not make large investments for the same reason. If there is one thing Trump is good at, that is creating uncertainty.
We truly do live in a global economy and Trump is creating chaos all across the globe. We have problems with China, Europe, Mexico and Canada. All four are major trading partners.
I recently ordered some parts from a supplier who sources out of China. They can't find anyone else that can get anywhere near the Chinese price. Delivery pipelines are disrupted. They are having a difficult time keeping inventory up.
These sort of problems are happening all over the place. Result? Uncertainty.
Don't think this mess in Syria doesn't have an impact on investment and spending. NATO is under stress and the Middle East could explode. Result? Uncertainty.
The impeachment inquiry is also contributing to uncertainty. Not just because it is taking place, but because Trump is actively attacking our institutions, creating tremendous uncertainty regards to the outcome, no matter if Trump is removed or not. His attacks on Congress and our public servants creates an atmosphere of uncertainty of whether our nation can hold together. Now, who would invest in that?
1477
@Bruce Rozenblit - Trump thrives on creating uncertainty and chaos. The result is a nation up to its ears in stress.
233
Bruce is spot on per usual. I lost out on a 400k deal that involves 3 countries, and a very complicated supply chain. The end user can't get the investment money they expected, so the business does not need my goods or anyone else's either. Why? Uncertainty.
124
@Bruce Rozenblit
"Businesses do not make large investments for the same reason. "
Businesses don't make large investments any more. The money goes straight out into the board member's pockets.
76
As a (very) small business owner that due to the tariffs is moving production of my goods from China to Vietnam , I think Professor Krugman column is spot-on.
Over the last year I have been amazed at how complex and expensive a process it has been - and for the lack of a better word, I import simple "widgets". I cannot fathom the work/time/money/hassle involved with complex businesses making this kind of move.
The net result - we are watching every penny we spend - and we're not special - if we are pulling back this hard, then millions of others are doing the same. The cumulative effects of the trade war are just beginning to be felt in America.
Oh, by the way, all that money Trump talks about pouring into the US Treasury? I'm writing those checks, not the Chinese.
2182
@Pablo
I am so sorry Pablo but then, we all knew who would be writing the cheques.
69
@Pablo Indeed, goods produced in China won't be selling in the States if no American is importing them. The ones that make the most money are not the Chinese but American tax payers and business owners.
5
@Linda Higher costs for raw materials and components do not improve an economy, no matter what fantasy Trump succeeds in selling to his fan base.
Taxpayers and business owners are going to end up with less money in their pockets, as Mr. Krugman just explained in this column. Perhaps you should read it.
136
trump proves over and over that he is clueless about the consequences of his policies. trump repeatedly brags about how many trillions his trade war is costing China, without considering possible collateral damage. China buys 40% of the world's copper production, and Chile is the world's largest copper producer. With prices and demand for copper falling, Chile's budget is strained and the Chilean Peso is also falling. trump's trade war may have been the final straw that led to the social upheaval threatening Chile's center right government that Nixon and Kissinger installed in 1973 and trump is probably oblivious to his contribution to the unrest in Chile.
12
Exactly. And billionaires making billions is not much of an economy when it only involves a few people. They support a gig economy, people like me who have provided services and have no security regarding health care or retirement. I was saved by my wife, a teacher and union member, who gives me access to the safety net. I'm one of the lucky ones. I would hope that when this debacle is over, more people would be included in access to a decent life.
1367
The gig economy stinks. It’s better than no job, but just barely.
34
@dave beemon You wrote the magic word: Union. The resurgence of a GLOBAL Labor Movement is long past due. The 1% has prospered (as they always have) only by means of cheap labor. Those who produce the goods deserve a bigger piece of the pie.
74
@dave beemon The good news is that this country once knew how to provide decent jobs for a lot more people than it does now; at 70, I remember those times and also some of the reasons why it could. The bad news is that so many people younger than me have no memory of those times and seem to think that today's dystopian hunger games situation is normal.
42
We can survive a recession I am not sure that we can survive a dismantling of our Constitution.
2790
@Steve Republicans are doing a pretty good job of dismantling the Constitution right now and how far will they take it remains to be seen.
304
@Steve
It used to be the ECONOMY, stupid.
Now, with Trump, I think it's about DEMOCRACY, stupid.
----------------------------------------------------------------------
I wish Prof. Krugman would comment on the role of democracy, in stimulating our economy. Democracy in the workplace is key.
I hope the Times will write on democracies role in the economy. They could discuss the "Democracy" song of Leonard Cohen."Democracy is coming to the USA"
--------------------------------------------------------------
101
@On the contrary, Steve, we need to burn the constitution and start over.
16
Spending spare change on your local newspaper makes a big contribution to your local economy. Today Trump canceled his subscription to his local paper, which he probably didn't read, and couldn't care less if anyone else in his house reads,
but fortunately everyone else can access on line. Also today,
Pence admonished American businesses for not applying American values to their relationship with China. We assume that means lying, cutting your allies loose, and violating treaties, the current signature White House values.
37
@BBB
He asked his entire administration to cancel their subscriptions to the New York Times
and the Washington Post
He has declared war in the free press, again.
We had a saying in the old country:
Never pick a fight with someone
who orders ink by the barrel full
1
The reason for the lack of confidence is obvious: people with responsibilities to themselves, to their families, to their employees, and to their shareholders...know what erratic behavior and incompetence look like. And they see it in the grift and graft of this White House and this president.
Remember how quickly Trump took credit for Obama's economy? Any bets Trump will take responsibility for his role in the past 3 years (and correct bad policies)? Not holding my breath. That's the lack of confidence talking.
Business knows what incompetence looks like.
18
Money and politics need a time out. Not only in elections, but wherein , “ the economy stupid”, becomes accepted as revealed truth.
An economy without governance is like a life not worth living.
The luxury of voting ones pocketbook is rapidly fading in the rear view mirror.
2
Another point: the Dow Jones has climbed back to about where it was IN JANUARY 2018! In other words, it has gone nowhere in almost two years. Sure, there was an initial run given the tax giveaway to big business, but that was just a blimp. I'm surprised this was not mentioned by PK.
15
Like Bill Maher has said, we have survived recessions, including the terrible one that began in 2008. It's time for a noticeable downturn in the economy in 2020 anyway, so let's get on with it and get the demagogue who hates the Constitution out of the Oval Office. Only Russia benefits by him staying there.
10
The business community should be terrified, with Trump in charge. It is absolutely insane to allow for business failure, cheat and wacky prognosticator Trump to be THE steady hand on the tiller of the US economy...
11
I read that story last week of Navarro’s self personified, thoroughly supportive friend and colleague, Mr. Vara, last week. I was disappointed he wasn’t included in Gail’s contest yesterday.
Another self-enhanced charlatan, just not as well known, because there are so many more known infamous trump appointees in this rogues’ gallery. His trade policies will kill the economy, though I’m as conflicted as you have been, since that may be what finally saves the election. I’m being positive, though, and hoping on impeachment and removal first.
10
@ElleJ
Let's not forget about Trump's alter-ego advisor.
Trump's 'John Miller/John Barron' alter-ego should get along great with 'Ron Vara'.
1
This must be Dr. Krugman's 20th column announcing the collapse of the Trump boom. Some day it will be true. That's inevitable, but I would not bet money that this is the time. Paul Samuelson famously quipped that the stock market has predicted nine of the last five recessions, but at least the stock market has a better record that the Times' resident Nobel Laureate.
4
It used to be the ECONOMY, stupid.
But now, with Trump, I think it is also about DEMOCRACY, stupid.
--------------------------------------------------------------------------------
I wish Prof. Krugman would comment on the role of democracy,
in stimulating our economy. Democracy in the workplace is key.
I hope the Times will write on democracies role in the economy.
They could discuss the "Democracy" song of Leonard Cohen.
"Democracy is coming to the USA"
------------------------------------------
1
Even if the Dow is at 50000 on November 2020 this man has to be kicked out by the voters if the disgusting GOP senators (yes that is the best adjective to describe McConnell, Lindsay and the bunch) haven’t impeached him and sent him to Sing Sing already. Talking about what the economy should or would do us really not relevant if we want to look ourselves in the mirror anymore. That includes Nobel Prize winning economists turned pundits, I am afraid.
6
Does the average voter really care about business confidence?
What the average voter should care about is that his/her median real family income has increased $11,437 since 1984.
That is a $336.38 increase per year for the last 34 years or about 0.6% per year. (https://fred.stlouisfed.org/series/MEHOINUSA672N/)
That said, the OECD's Business Confidence Index for the US is now about where it was in early 2009. Hardly a reason to celebrate.
And it probably means nothing to the average family just trying to get by. Probably not much of a correlation between the two metrics.
17
The average voter cares nothing for business confidence. What they care about is that despite all the talk of a Trump boom and those great tax cuts, their paycheck has grown very little and their tax cut was so tiny you’d need a microscope to see it.
8
@Fred
I will take you at your word about the increase in family income since 1984. However, the cost of living has surely increased even more. Certainly healthcare, housing, and the cost of higher education has increased far more than $336 per year.
So Americans are going backwards. Unless you belong to the 1%.
15
This is why there are so many homeless people, and working people having to go to food pantries.
7
When will this end? When the GOP wakes up to reality, nah. Or the 2020 elections which seems the safer bet than impeachment.
1
@texsun The Trump GOP has been resisting any action to protect the integrity of the 2020 election from foreign or domestic tampering.
Keen Netflix viewers ("Inside Bill's Brain") will note that the Gates Foundation has become a victim of Trump's capriciousness. Their development of next-gen nuclear reactor technology using spent uranium was proceeding to trials at scale in China when Trump's tit-for-tat trade spat torpedoed the whole thing. Why anyone with a lick of sense thought this guy was malleable or teachable a better option than Hillary is beyond me.
13
At some level simple is always better - use the economic data to show the “big tax cut” failed. Use the facts, not hyperbole. Don’t play DJT’s game. Play offense, not defense.
2
@BrewDoc
Unfortunately, facts don't seem to appeal to Drump voters who seem more concerned that their privilege is being challenged in an increasingly challenging economy.
The herd does not vote with its brain.
1
“To be fair, the overall state of the economy is still pretty good.”
Gee, Paul, what makes you think that? A stock market maintaining record highs and unemployment at a 50 year low? As “collapses” go, I guess this one is rather benign. But don’t let me interrupt your narrative. Pray continue with this week’s End of the World.
1
a set of income distributions adjusted for inflation for a set of years over the last 25 say, would be interesting.
https://www.irs.gov/statistics/soi-tax-stats-individual-statistical-tables-by-size-of-adjusted-gross-income
That would show who the economy has actually been good for
1
Stability is necessary for growth - the Politics are anything but stabilizing - as "Republicans" and "Democrats" fight over power - the only losers will be us peons..
2
This is our national karma, my friends. Embrace it.
That said, the pus and poison have to leave the wound before it can begin to heal...
4
With any luck, next year's election will be a referendum on Pelosi's interregnum management
3
Donald, as jealous as he is, could only ride Mr. Obama’s bubble but so far. His day of reckoning is coming. He just may not be here to see it.
But we will suffer just the same.
10
Because economic figures don't lie.
2
So will all the farmers, and manufacturing people who voted for Trump to help them see the writing on the wall and make a better chouice next time or will they use their cognitive jiu jitsu and find an extremely contorted way to STILL blame the Dems and Libs for all their woes?
6
@arusso I think we have not heard the last of "but her emails !" Not that that slogan makes any sense, but the Trump GOP has long since let go of reality, facts, evidence, or notions of serving the people.
4
Let’s be honest,PK.
Given identical conditions if Hillary Clinton were president right now a gloomy article like this would never be written.
5
@Arch Stanton
Identical conditions could never exist. Clinton would never have started a trade war, never allowed such a huge tax giveaway to corporations and the 1% and never allowed the US policy to be directed by Putin. All this Trump has done.
13
If the senate fails to convict and remove him from office it's on them. No one said being Senator required being a lemming. Have they no shame? No integrity?
10
Yeah, there have been LOTS of new jobs created!
My daughters each have TWO of them!
23
The Republicans need to constantly allege outrage or show they are going to win. If they do not, their base will not turn out and their entire party will get slaughtered in 2020. Trump barely won in 3 states which gave him the election. It is very difficult to see how he can win those states again or other states that he lost. Get ready for more lying and cheating. The Ukraine stunt is not the only thing in their bag of dirty tricks. SAD!!
8
@albert
Don't forget the taxpayer dollars he spent sending the Military to the border in an attempt to stem the bleeding in 2018 elections.
Funny how thew crisis disappeared after the elections...
Kinda frightening what he might do to buttress his 2020 chances.
5
I wouldn’t put anything past him.
Peter Navarro has an imaginary friend, known on the Internet as a sock puppet, to echo his ideas. This is dishonest. It is also lunacy. These are the people controlling our government, our laws, and our lives. We are waist deep in the Big Muddy.
9
The left has been cheerleading a collapse of business confidence and onset of recession for about a year. Any softening now will be nothing compared to the economic implosion and capital flight we can expect if the Dems win in 2020. Leftists convinced of victory should start buying gold and, of course, store it outside the U.S.
1
Every US president had bad days in office. I am not trying to be facetious but has Trump ever had a good day in office?
8
@nzierler Trump has played golf on many days in office, which perhaps he enjoyed (despite his well known tendency to cheat). More golf days for Trump in less than 4 years than Obama had in 8. Trump may feel a twinge of discomfort that he took a job far beyond his abilities, but he continues to tell himself that everything he does is "perfect."
A wise man once wrote, "Everything Trump touches dies."
11
Be prepared. Don’t be surprised but the republican. Their policies have always sought to disenfranchise people who aren’t rich white mean
3
I despair sometimes of making sense of this economy. I've read Krugman and others, and I'm well versed in theory, and I have almost unlimited printing and photocopying privileges in our Business department, and yet I can't get a handle on what is going on.
It's like the zombie economic apocalypse. The economy is alternately lurching, shuffling, and jerking its way onward when it should have given up the ghost and stopped its infernal twitching ages ago.
Like Krugman, I predicted that Trump policies, if enacted, would collapse Obama's vibrant recovery into a recession. The tax cuts came and went, but the fiscal stimulus of the proposed infrastructure rehabilitation proved too much for the limited capabilities of the Trump administration. I toss that up as an explanation of my failed prediction, much as I would offer up a jockey error for my failure in handicapping horses.
But the most bothersome part of all this is that there should by now be some sign of inflation. Where is it? It could be that it is buried in the greenback currency appreciation in the face of global economic malaise and uncertainty, crouching, ready to pounce.
The world is awash in savings. "Savings equals investment" is upended in a world swirling in Trump's uncertainty, and bond yields drift down to nothing as the tech titans look for someplace to stash their loot.
Maybe we'll get neither growth nor recession, and just remain adrift, aimless and uncertain, on the Sargasso Sea of economic doldrums.
3
When one's boom died, another's boom is emerging relatively or at least starting immediately, especially in the world of politics. If the author's claim is true, there should be such a move now or in the near future.
With new lows in business confidence on the horizon, we can expect to see the floor drop out. Recession is defined as two successive quarters of declining GDP growth. In the 2nd quarter of 2019, GDP 2.8%, in the 3rd quarter, 2.1%, and if the predictions at GDP Now are correct, is seeing 1.8% GDP growth. Although the official announcement of recession usually is made in retrospect. Business doesn’t wait for bad news announcements, they create it. Businesses see top-line income plummet and there go profits, growth, and dividends. The loss of business confidence quickly infects consumer confidence and leading predictors, that’s when the stock market averages tank and fast.
Recession fears can flood into impeachment. When the news cycle is on fire and the credibility of political figures at the top fall into disrespect, political mutiny is soon to follow. Just as businesses seek higher ground when GDP growth failure contaminates the picture, consumers aren’t far behind. There is no indication that the trade war is under control or even necessary. When China will capitulate is unclear, but with signs of economic recession in place and impeachment is on the horizon, don’t make any bets. The political significance is obvious.
2
@Stuart
Just a clarification, recession is two successive quarters of negative GDP growth. In this case we have declining growth, but it's still positive, so it's not really indicating a recession. It could precede one, but I don't think declining positive growth is the same as negative growth.
Please correct me if I'm wrong. Thanks.
1
Although he keeps shouting how much he loves his country,the truth is just the opposite. He cannot be telling the truth if he is against everything this country stands for (welcoming refugees,be part of international order,care for farmers,the poor ,children and minorities, FBI,CIA,the men and women in uniform and of course the US Constitution). He is now going against whoever criticises him in the Senate and Congress. He raised the tariffs so that farmers and businesses suffer. He insulted all the people who serve the country under the above categories. He has always been against USA since banks had refused to loan him money for his projects. He is running the country like a casino. It's time he focused on the real job of fixing the infrastructure,education and healthcare because that will help everyone including his supporters.
11
@HP I do not believe Trump is capable of doing any kind of real job. He likes his rallies and his opportunities to bark orders at people. The rest of being president does not interest him. The GOP is firmly against programs to help ordinary people. Betsy DeVos is against public schools. The GOP's great new health insurance plan is never going to happen. Instead, they continue demonizing people in need, whether immigrants, children needing school lunches, or women who wish to make their own medical decisions.
4
Trump was born on third base and he’s convinced he hit a triple.
Remember when Obama was president and business leaders of the Republican bent would repeat, "Companies aren't investing because there is no certainty. Businesses can't play."
Don't ya miss those days? The level of uncertainty has boomed since he left office. What surprises me, though I know it shouldn't, is the silence from those people.
19
The only reason trump is getting away with any of his economic ineptitude is that he inherited a good and growing economy. But I'm sure trump would have done exactly the same things even if the economy had been in the dumps, because his only reason for doing all he is doing is to stick it to China and other countries he delusionally claims are taking advantage of the US. And we would now be in a depression rather than a MILD slow down.
9
Trump can take as much credit for the economy as he can for the weather, i.e. none at all. Anybody who believes otherwise is a sucker about to be fleeced.
Longterm, the policies in relation to the environment will increasingly lead to global impoverishment. For those who happen to making out right now - you're just living in a fool's paradise and odds are - it's not going to last much longer.
Will you draw the appropriate lessons? Probably not. That would require some degree of intellectual rigor completely lacking in those addicted to playing the equivalent of an economic slot machine. You may be feeling "lucky" but only fools feel lucky when the house is riding the odds.
17
After nearly three years of this feckless disaster of a presidency, and with essentially unimpeachable evidence that the president committed a crime and should be impeached, we are still operating under the assumption that the Senate will not convict and that Trump could ride the economy to another electoral victory.
And if Trump's poll numbers are sagging next year, we should not be at all surprised if some "miraculous" trade deal suddenly gets worked out with China in order to send major economic indicators soaring.
Can Elizabeth Warren get Medicare for all worked out in time? Will millions take to the streets between now and the election to protest Trump and his enabling Republican cronies? Are there more whistle-blowers waiting in the wings?
Collectively, do we care enough about defending our democracy and preserving and sustaining its lifeblood that resides in our Constitution?
We need all the help we can get to shut down this perverse and disgusting Trump spectacle. Let's hope we can get it in force ... the sooner the better.
And we must keep in mind the most important thing about this ongoing drama.
We all have our parts to play.
It's up to us.
28
yes. yes. yes. unfortunately, Trump will ride this elephant in the big top as long as he can. given the opportunity to sell out his country to make money off the jittery, reactive market is part of his pleasure.
12
The Trump boom is really the remnants of the Obama boom. The actions Trump takes, for instance with the tariffs he placed on China, have arbitrarily done damage to the economy. His trying to build a wall, and supporting dictators has created a wedge with our allies.
I am sorry for those in denial, but Trump is a failed business man, as glimpses of his taxes show. He is leading us down a path created by his Houdini like ability to fake-out his followers.
17
I keep praying for more Republican primary challengers to come out and pull the rug from under Trump. Lifting that rug will expose all Trump has swept under it. The biggest pile of dirt that means the most to voters is that "beautiful healthcare plan" that was always a heap of trash. Why years later is there not even talk of it? McConnell told Trump "not until after the 2018 elections" but that came and went and healthcare went under the rug. Same for the infrastructure program. Next for the broom is the "easy to win" trade war that has cost proud farmers, for now and maybe forever, their access to China, the biggest market in the world. He has cost them their livelihood and forced them on to the dole. This trade war mess has hamstrung businesses big and small with supply chains shattered and raw material costs rocketing out of control. What does Trump have to show for it? There is no protection for intellectual property. China may buy agricultural products but not until Trump eats all those tariffs on China's goods.
10
In a nutshell as most incompetent managers do Trump has surrounded himself with other incompetent people, family members or sycophants none of whom will point out the errors they are committing. It does not end well in business nor will it end well for our country.
19
Because banking, business, economics and finance aren't sciences they are incapable of providing predictable and repeatable results.
There are too many variables and unknowns.
America is not a business. America is a nation state.
The President of the United States is not a businessman. America's President is the head of government/state.
7
Looks like rational disappointment has replaced irrational exuberance even among blinkered Trumpists. What else would anyone expect?
4
There are too many depressing implications about the Trump presidency to keep track of. But one definitely in my top 100 is the political implications of this column:
There are a large number of right of center citizens who would vote to reelect Trump for maybe 3% GDP but would think twice at under 2% or so.
Seems the rule of law and the survival of our democracy should be worth more than 1% growth in GDP.
Perhaps it's time to update that famous old story attributed to many from Churchill to Shaw to Twain:
Trump: "Republicans, will you reelect me, an openly corrupt antidemocracy white nationalist, for 4% GDP growth?"
Republicans: "My goodness, Mr. Trump ... Well, I suppose... 4% is really good, can I hear more?..."
Trump: "Will you reelect me and let me finish off my attack on democracy, minorities, and America's standing in the world for 1% growth"
Republicans: "Mr. Trump, what kind of unpatriotic citizens do you think we are?!"
Trump: "Republicans, we've already established that. Now we are haggling about the price."
2020's GDP growth should have nothing to do with THIS election. That it will for many voters is both a reality and utterly depressing.
13
@LT
A recent poll showed that, despite all of the evidence coming out of the Ukraine investigation, in addition to the past 3 years, 99% of white, evangelical Protestants still support Trump. 99%! I don't know what percentage that is of the total electorate, but it shows why his base seems to remain about the same no matter what he does.
1
Due to Trump's "shrewdness," (clever underhandedness is a better description) which he has never been properly called on, he bought off and bribed the stock market, which enhanced the wealth effect and supported overall economic indicators.
How? The corporate tax cuts, which were close to 50% (37% to 21%), improved the bottom line of the S & P - earnings, that is - by about 25%. That juiced the market. Then, with the added savings to companies, they bought back stock, i.e. buybacks, and this also helped to raise stock prices. Then, he gutted regulations - another gift to Wall Street - but bad for the environment. All this happened while the deficit ballooned and the wealthy got their 90% of 1.2 trillion in tax cuts. The wealthy, of course, buy stock. So the entire move fed on itself.
He is truly the "stock market president" - he knows it, but the rest of us don't. This bolstered the economy in a way he takes total credit for. No one ever mentions it.
If you are an investor, trader, or fund manager, you are going to keep bidding stocks higher, every chance you get. It is simple human nature: payback for gifts given.
3
The assault on the committee hearing was not just "stunningly bad behavior," it was criminal. It was blatant obstruction of justice, witness tampering and conspiracy to commit those crimes, including by the President. Call it what it is: Criminal.
22
@dano
What’s even more egregious about that stunt, is several of those republicans that were claiming it’s unfair, SIT ON THAT COMMITTEE. Oh, and by the way, a total of 43 republicans sit on that committee, which is MORE than Gowdy had on the committee during their investigation into Benghazi, and look on page 360, and 406 of that report and see what Gowdy said about gathering information behind closed doors, people need to look back in recent history and see how the House republicans ran their investigations. What yesterday’s stunt proves is all the republicans that aren’t privy to the information that’s being gathered are only angry because they can’t take facts and twist them. Since they can’t kill the messenger because his character is impeccable, all those sad republicans can do is complain about the process. And since this isn’t a court room (yet) there is no due process afforded to Trump or his deep state cronies.
1
Trump will resolve trade issues with China.The Dow Jones will hit thirty thousand and unemployment will hit record lows. Notwithstanding Trump’s obvious unfitness for high office he will probably get re-elected. Unbelievable!!
1
More than anyting I feel like there's a business collapse coming because of the uncertainty quotient. Yeah, most financial indicators are doing really well. But we have a leadership problem in this country and that never, ever ends well. The Trump Effect, as it will be known to generations to come, will deal us a horrible blow. Look at the evidence. Republicans are losing their minds over this impeachment inquiry, even though, objectively, there is really solid evidence that this President is corrupt. There is way way too much optimism in America today. We have a serious problem and it's called Donald Trump. Buckle up. It will happen fast when it happens.
10
@Aurora
I'm tired of hearing what a great economy we have. The fact is that wages have been pretty much stagnant for the vast majority of American workers for decades. There has been a small increase in wages in the past year, due largely to states increasing their minimum wages. The federal minimum wage has not been increased in over 9 years. Most workers have fewer benefits; many are classified as contractors and get no benefits. Even workers who have retirement accounts cannot afford to put much in them, since they are just getting by. So, most do not benefit from the near record stock prices. So, the economy is great for a small percentage of Americans, while it does not work very well for the vast majority. I wish the media would clarify that when they report on how well the economy is doing.
6
At this point how could anyone have any faith in anything. Trump has shown he has no idea what to do while he tweets insults and lies all day long. The GOP is running around like a mob trying to save their godfather
18
"Everyone is following the impeachment story..."
Basically a cliched overstatement. Frankly, I know three people who are not following the story. Well, Paul may be an economist but his prose is a bit like beating a dead horse (it takes one cliches to know another, and another).
Paul is right on one issue. He does not add much to the story. And when he claims the G.O.P. response is likely to be uglier than you (that would be me) imagine. How does Paul know what I may imagine? Oh, that's just another cliche? Well, Paul seems to relish forecasting gloom and doom (more cliches on my part). Maybe he feels if he says it enough it might come true. All he's missing is ruby slippers. You don't have to be an economist to know which way the wind is blowing. Forecast calls for more gloom and doom from the East Coast combined with a good deal of hot air. And Trump winning the next election because the Democrats are all betting on a dead horse.
3
Just curious, if Trump were a Russian spy, asset and traitor, what actions would he take that would be different than his existing economic and political decisions? Any thoughts?
8
@Alan
I believe that Putin has orchestrated all of it and Trump has followed orders to the letter. Even the latest “investigation “ into the origins of the investigation of the Russian influence in the 2016 election—serves Putin’s desire to spread discord and distrust in this country.
2
Trump is nothing if not impulsive. At some point he may well see bankruptcy around him just like all those AC gambling properties in the late 1990s. He had Fred to bail him out then and eventually a career in TV to create an an image. And then a gift from Obama -- Donald is in the House!
All tnere is now is bad news from his POV and his tweets are not pushing back with any effect. That impulse I was talking about may have us waking up to the deal of the millennium.
Trump agrees to walk with an agreement not to prosecute him and his family in any court of law at any level. A free pass. If I had his elbow I would whisper it in his ear.
2
Business knew trump was no gift to them because they knew his limitations too well. In NYC he has a long comedic history of being the butt of jokes. They thought he could deregulate a few things so the more crooked investors could cheat freely in a few areas, but he was never going to come close to what he promised. And hasn't.
2
Michael Cohen was right. Trump isn't leaving the White House, whether he gets impeached or loses the election in 2020. This is going to get uglier than anyone realizes. We elected an autocrat.
8
I wish I could agree, but I think millions of Republicans are so wedded to Dangerous Donald that they will vote for him even if the economy tanks. DD will find a way to blame Democrats that his supporters will buy into. I hate to say it, but DD is going to get re-elected no matter what happens with impeachment, war or the economy.
6
The United States has enjoyed a very strong economy the last several years despite Trump, not because of him. When are the actual business owners and business executives going to get credit for the success of their own companies. Trump has nothing to do with the success of my business.
10
When the markets actually tank, I'll believe it! It's still October the usual month of economic reckoning, but so far all the predictions have not really materialized. While Trump has done little other than his tax cut to stimulate the economy, it still continues to sail along. While no one wants a recession, it may be the only way to rid us of the scourge of Donald Trump and his Republican enablers who have sold out the country to curry favor with him and his fear base. There's a year to go so as someone likes to say, "Who knows?"
8
Nobody can have confidence in the middle of chaos. You cannot plan if you can't predict and no business can predict anything in the middle of trump created chaos.
18
Syria provides some insight into how the President will likely address slowing growth (or a recession) as the election approaches: he'll capitulate on his trade war and, without warning, rescind all tariffs and hope desperately for a reciprocal move by China.
Needless to say, China will immediately recognize the enormous bargaining advantage that this tactic gives them, and demand concessions from the administration. Mr. Trump understands that remaining in office is the only way he's going to postpone criminal prosecution, so he'll give China everything it wants.
So tired of winning . . .
24
@Scott
I'm just ... tired ...
3
In early January, 2018, the S & P pushed into 2,800 territory and the DOW into 26,000 country. Today the S & P trades at 3,010 and the DOW at 26,805. Sure, they've both been higher, but throw a trend line on the graphs for the last two years and it tells you what you need to know about the business environment.
Ineffective tax policy, very bad foreign policy, shortsighted trade policy, skyrocketing deficits and debt, and a leadership war on this nation's middle and lower classes.
Trump's supporters love the guy, but that owes entirely to their willingness to believe that an actor who plays a neurosurgeon on TV can do brain surgery or one who pretended to be a successful real estate investor is one and is qualified to lead the most complicated economy and business environment on the planet, and, arguably, in history.
But numbers don't lie and that's a problem for a man whose lie count is the only index that can be relied on to skyrocket.
74
"Business interest spent a long time in denial, but now even they are facing up to the reality that Trump and his team are very strange people who have not idea what they are doing."
It takes some people a long time to catch on to what is going on. Just because someone has lots of money doesn't mean that they are smart.
The Donald always seems to be angry and having a temper tantrum. He lashes out in rambling incoherent tweets and speeches. It is amusing to watch the "journalists" on television talk about "President Trump" doing this or that as if they were talking about a normal president.
Business people are losing confidence in The Very Stable Genius. What took them so long?
43
@Aubrey , "What took them so long?" They are conservatives. They fear change. But change is real and inexorable. So they go into denial out of habit - over and over and over. "Losing confidence" just means they're still in denial.
Once the aeolian gyrostatic coprokinetic event happens, they'll whine that they want to go back to the "Good Olde Days."
2
@Harold (Mexico)
Thanks for that very perceptive comment.
Best wishes and stay positive.
3
Doesn't show in capitalists enormous campaign contributions to the Trump Reelection campaign. Then again, the top contributions come from the FIRE sector with fossil fuels a surprising second. Check out the FEC!
8
@Matt, Fmr Pres J. Carter defined political contributions as legal bribes -- the current US administration is proving he was right.
1
The idea that business leaders' 'confidence' is some sort of bellwether about where the country's economy is going is a public relations illusion. Most people figure out long in advance of the Executive Suite flackery what their economic futures hold in store, and they act accordingly. This kind of 'lagging edge' prognostication convinces no one, because bad news filters from the bottom up. Mostly, so-called Business Leaders spend their time and efforts hoping against hope that they can survive whatever is looming on the horizon. When you own the ship, the last thing they want is to be seen running for the lifeboat. A declared loss of confidence is a de facto admission that that their line of credit has been canceled or drastically reduced. Things are going south, and the supporters most at risk jumped ship long before the announcement by the leaders that their vaunted confidence has gone away. The only people who might pay attention to those somber pronouncements would be the bankruptcy lawyers and turn around specialists, knowing that a perceptible retreat instantly turns into a rout.
6
With 20 to 25% of the U.S. economy hurting, the consumer sector is propping the rest up, and this economy is truly on borrowed time. Maybe it’s time we take a breather from buying cheap clothes, shoddy furniture, and larger t.v.s. etc. For the holidays why don’t we make simple gifts, and save our money to invest in the next expansion. This would bring reality home to our Stable Genius in Chief.
Sadly the Trump Recession will be global, and take to recover. By then Trump will be back in the private sector and possibly have have his own talk show where the microphone and speaker will be the only connection, he can hear himself 24 hours a day.
16
Paul would sooner wish we were back in a recession than to admit the economy ever performed at all well under Trump. This cherry picking of data has no substance - yes there are pockets of the economy that have not performed well, and yes, we may hit a broader recession soon, but fortunately for us (and unfortunately for your column) that point is still yet to come. The increasingly partisan opinions you write will neither hasten or delay the inevitable.
6
@Arvind :
see Frank Casa's comment, below yours.....
1
He promised a growth of 4% and it is half of it. He was going to revive coal mining. He was going to bring home all sorts of businesses. He was going to cut the deficit. He was going to create millions of industrial jobs. Instead, he has created a bigger deficit. He has mismanaged a huge tax cut. He, like the spendthrift son of a wealthy family, has wasted the resources he inherited. His long history of bankruptcies should have been a warning. The only greatness he has brought is in the size of the letters that form his name on buildings he does not own.
126
Business confidence collapsed because they expects Warren to be next president and she will not think twice about splitting companies, increasing regulation and raising taxes. Trump chances of re-election are increasingly uncertain, especially considering never-ending impeachment process.
4
@Alice :
so, you're OK with tax cuts ONLY for the 1% with it written in to tax laws that they will get further breaks by moving overseas?
You're OK with Trump/Mitch/GOP ruining the air, water, land.....all for the benefit of fossil fuel giants? And wiping out how many species?
OK, then, that's fine as long as you're ok with it.
18
Wow. Trump and his people have blamed Obama for everything he perceived as negative, no matter how long Obama has been out of office. Now, you’re blaming the uncertain state of the current economy on someone who may or may not even be the Democratic nominee in more than a year’s time.
11
Warren isn’t even the nominee yet, let alone been elected. How can this possibly be her fault? And if she does get elected, you can blame that on the fact that business leaders don’t seem to want to share anything with their workers. They’d rather buy back their own stock so they can make themselves richer while their employees head to the food bank so they can feed their kids.
By all measures the economy seems to be doing very well. I see optimism everywhere in my "rich" blue city. As businesses and investors look ahead, if there is any gloom on the horizon it is in the threat that Warren and company pose. Krugman has long since lost any credibility that he might have had.
1
Will we go to negative rates?
No Trump supporter here, but our Fed has been printing money since 2009. We never really fixed our bizarre, disassociated, fractured economy.
Some have done well, Wall Street premonition experts and many civil servants, like those in New York, New Jersey and Illinois.
A civil servant with a pension of $80,000 per year has a net worth of $4,000,000 using a safe return of 2%. Sometimes you have both a husband and wife both with similar pensions.
We also have fully employed folks, who can't afford a place to live. A physicist buddy retired with $1,200,000. he's risk averse. Guess he'll have to survive on $24,000 per annum until his social security kicks in.
Trump is only the closing act as the comedy turns into a tragedy.
8
It is curious that the Middle East is not mentioned. I know, its oil is not as important to the U.S. as it once was. And I have no desire to hang around in any country (Middle East or otherwise) any longer than is necessary.
But Donald has been actively knocking the props out from under our position. Someone will notice eventually, probably before the election.
5
Perhaps the fact that the Democratic candidates are all promising to raise taxes, and have also declared that the CEOS of Pharma, Coal, Oil, Banking, Tech, Hedge Funds etc. are all criminals, might have something to do with it?
5
@LTJ Funny. Usually republicans blame democrats AFTER they win. Now you are already blaming them even before they take over from Republican mismanagement.
2
Since before Trump took office, all economists said he was going to tank the economy. Here we are almost three years later and I'm not seeing a recession or anything like it.
I can't take you at all serious, Mr. Krugman. You are starting to sound like a televangelist telling me that Jesus is coming any day now. I've been hearing preachers tell me that since the Eisenhower days and still waiting.
I can't stand Trump but I just took a look at the Dow Jones and it has been going up and up since Obama. When Trump took office it was around 16,000. Now, its around 27,000. That's not bad.
5
@tom harrison Go buy a ruler and have someone explain a linear trend (extrapolation) to you - not to say, as Dr. Krugman noted - that the business cycle has been abolished somehow.
Oh, and the Dow (DJIA) is not nor has it ever been the economy.
6
@tom harrison
By chance when you were looking at the Dow, did you the notice the epic swings up and down? Not the sign of stability you would want to see.
@tom harrison Your Dow numbers are off Tom. If you compare apples to apples: Obama presided over a 57% increase in the DJIA his first 1,000 days in office (from 7,550 to 11,808). And Trump has presided over a 35% increase in the DJIA over his first 1,000 days in office (from 19,827 to 26,800). % increase is what counts.
2
Wall Street--the stock market--deals only with the largest companies. But collectively it's small to medium sized, private business that is the engine of "the economy." The latter are feeling the most uncertainty, because every "tweet" and impulsive act of reckless narcissism by "Trump and his team [who] are very strange people who have no idea what they’re doing" has a direct impact of their decisions. There is a massive disconnect between lagging indicators such as unemployment rate and leading indicators such as business confidence. Only when MAGA business owners finally get hurt will there be a giant domino effect. When it happens, it will happen fast, and Wall Street will be caught with its pants down like it was in 2007.
23
Mr. Krugman offers the observation, "[A]s the net closes in, the G.O.P. response is likely to be uglier than you can possibly imagine."
If the tide of Republican voter opinion turns against President Trump, and the evidence for impeachment boxes Republican Senators in so that Mr. Trump's removal from office seems likely, his response will likewise be uglier than anyone can imagine. I would not put ANY action past Mr. Trump, including starting a war.
The only things Mr. Trump values are power, money, fame, and complete and unquestioning loyalty and deference. Because he doesn't care about anyone or anything else, he will do whatever he feels he needs to do to retain those things, including putting Americans in harm's way.
President Trump has demonstrated he is capable of anything, which makes him the most dangerous person ever to hold the highest office of the land.
54
@jrinsc Excellent take!
2
The economy right now is doing well for Capital. Labor, not so much.
27
Exactly! And it’s going to take years if really good raises to make up for years of little to nothing.
1
From your mouth to a higher power’s ears... however, I work in the chemical manufacturing industry. We mainly serve the pharma industry. We are growing quite a lot and our projects will be much larger in just 2 years. Not everyone is hurting or not investing. My company is, both here in the US and in China. We should all get back to that state of symbiosis.
3
Dow, DuPont, Corteva, Arkema are all doing poorly. Chem is not that great.
The Trumpist cry for Trump's success has been "Jobs, jobs, jobs!" We are seeing lots of jobs in retail and fast foods. But teachers? Local and county government - police, fire, street maintenance? Not so much.
Steve's economic gauge: Trend in community college enrollment. When things get tough, the tough go back to their local CC to take a course in this and that, to finish that certificate ... anything to make them look better in a more competitive market for other than the lowest level, entry positions.
Guess what, folks? We're seeing a surge in CC enrollment, most particularly in at least my red area of California.
24
This has been my experience too. Lots of jobs, but most of them pay poverty wages.
Is economy that is propped up by 1 trillion of borrowing a “good economy”? Really?
How does that compare with good economy that produced 200 billions of surplus, that could had been invested, in 2000?
Propping up failing economy with huge loans has been a ‘trick’ republicans used since Reagan. How long we can keep doing that?
46
It's a simple choice; Pay taxes or make money off of guaranteed loans. Republicans have always favored creating federal debt that they could make money on. They are the "Borrow and spend" party.
Paul didn't you predict that the economy would tank as soon as Trump was elected?
8
@Lake Didn't he take that back almost immediately?
1
@Lake
Long-distance hindsight will be the best "predictor" of tRump's effect on the US.
Soon enough, more and more people will be saying "We should've known." "We were warned."
The big question now is 'How can Democrats still lose this next election?'
So, I advise both Elizabeth and Bernie to develop a visual aid to help explain the NET SAVINGS M-F-A will produce. It must be be able to imprint the fact that the NET EFFECT of M-F-A will be a large NET SAVINGS, a big NET REFUND to everyone in their paycheck. It will free trapped workers to change jobs when necessary. That will motivate businesses to pay higher wages and salaries with the money M-F-A will save them. It will reduce a large number of families that suffer the IRONIC catastrophic loss of everything they own thru MEDICAL BANKRUPTCY, despite having private health insurance! There are 1/2 million plus family medical expense bankruptcies ANNUALLY! These are caused by uncovered medical bills, that are sometimes accompanied by lost wages and salary of the main income earner. I call this IRONIC because a reasonable fear of a catastrophic loss is the main reason to buy any insurance in the first place. M-F-A will bring down drug costs and all other medical costs. It will create a large countervailing power—a single purchasing agent for all healthcare consumers.
The Democrats positively, absolutely have to convince Americans the M-F-A is the only logical and reasonable solution. And convince them that there is only a limited amount of time for a transition to M-F-A. That's because Big Insurance, Big Pharma, and Big Medical will use that transition to jointly stop any real money-saving change.
24
@Ben Andrews
"Amen" to what you wrote, and "Bravo" to you for writing it.
2
One of my mother’s CDs earned an amazing $1.47 in eight months at Citibank. Good economy indeed.
42
@Susan
Good rate of return if the investment was $10. /s
8
And I’m still making under $11/hr, despite having a CS degree. Doesn’t feel like a boom to me. Apparently I’m considered too old to deserve a decent job since I’m over 40.
1
I just had a modest dinner at a sushi place. 5-10 years ago it would have cost ~$25 for two. Price today: $45.
1
Collapse of confidence you say? Whatever metrics business leaders use to assess business confidence, common sense appears to be a little thin among them. Trump has been so negatively characterized by so many people in so many fields of endeavor, what’s taken so long? It’s timing the crashes, one climate catastrophe after infrastructure collapse which has them betting on when to panic. We’ll, it’s arrived.
26
And, my health insurance premium went up another $1650 or $137 a month, added to the already monthly $1462 in premiums and deductibles. And the country can’t get behind a Medicare For All candidate?
186
@rebecca1048 Posted elsewhere in these comments re Medicare For All:
I advise both Elizabeth and Bernie to develop a visual aid to help explain the NET SAVINGS M-F-A will produce. It must be be able to imprint the fact that the NET EFFECT of M-F-A will be a large NET SAVINGS, a big NET REFUND to everyone in their paycheck. It will free trapped workers to change jobs when necessary. That will motivate businesses to pay higher wages and salaries with the money M-F-A will save them. It will reduce a large number of families that suffer the IRONIC catastrophic loss of everything they own thru MEDICAL BANKRUPTCY, despite having private health insurance! There are 1/2 million plus family medical expense bankruptcies ANNUALLY! These are caused by uncovered medical bills, that are sometimes accompanied by lost wages and salary of the main income earner. I call this IRONIC because a reasonable fear of a catastrophic loss is the main reason to buy any insurance in the first place. M-F-A will bring down drug costs and all other medical costs. It will create a large countervailing power—a single purchasing agent for all healthcare consumers.
The Democrats positively, absolutely have to convince Americans the M-F-A is the only logical and reasonable solution. And convince them that there is only a limited amount of time for a transition to M-F-A. That's because Big Insurance, Big Pharma, and Big Medical will use that transition to jointly stop any real money-saving change.
9
Perhaps, but I don't know about citing low interest rates as a sign of lost business confidence. Actually US rates are higher than much of the rest of the developed world, where they are zero or even negative. Indeed, the world seems to be moving to an era of permanently low (or zero) interest rates, a consequence of rampant, even-increasing inequality, and the resulting flood of excess capital searching in vain for productive opportunities to invest in.
4
@Larry ....is it my imagination or are negative interest rates a tax on wealth onto which the rich haven't yet caught?
6
@Larry The negative rate in Europe have been a failure and will be here too and I don't see us going to them.
@Dan
Penalizing banks by charging them with negative rates is not going to create new investments. If banks can't see investment opportunities at the current low rates they will not suddenly get smarter if rates are dropped. The net effect will be forcing money on the sidelines into low quality schemes.
There have always been asterisks next the "boom" narrative: many of the jobs that have been created are low-paying, part-time jobs; the number of working-age people not participating is still fairly high, and the underemployment rates is also fairly high.
30
Any idea when those Chamber of Commerce Republicans will take any political action based on the “Trump Slump”? They’re quick to give money and endorsements to the opponents of progressive Democrats, when they suspect that Democrats are promoting an unfavorable business climate. Why the silence now? Is Trump so special that you can’t even make a public statement about him, let alone support his opponents, when HE is manifestly damaging the economy?
Memo to Chamber of Commerce Republicans: the Trump Era business climate isn’t going to get any better by itself. You’re one of the few groups that can influence the outcome. If I were you, I would join the political fray now, before even more of your future prospects trickle down the drain.
41
@Constance Warner
Why would anyone imagine that many other businessmen are more competent than Trump?
He is just noisier.
The economy is 'good' for the 1%'ers, corporations and other GRIFTERS, but for the working poor and middle-class, not at all.
135
I'm not an economist, by any stretch of the imagination. And I sure didn't vote for Trump, either. No, I'm just a retired old GM/UAW guy, having a chuckle or two at the way things turn out sometimes. Who would have thought a Republican businessman, Trump, by playing populist in order to garner the votes of blue collar types, would have inadvertently strengthened the hand of union negotiators in the year 2019 like he did? Trump knows, if he has a snowball's chance of being re-elected in 2020, that he has to hold on to the blue collar union types who crossed from their traditional Democratic roots to vote for him in 2016; you'll note the total lack of interference or criticism you'd normally get from a Republican White House during a long UAW strike. Crickets this time. Basically, Trump just said he wished GM and then union would settle. Furthermore, unions have become quite bold in setting a new agenda, a stronger one, for the year 2020 and beyond, with Democrats now joining the union bandwagon in a manner I haven't seen in years. Meanwhile Trump and his business-minded Republican Party have been silent as the Dems have talked of repealing Taft-Hartley, sector bargaining and card-check. All I can do is say "thank you, Trump" for inadvertently, with your silence during the strike, placing unions in a more prominent role in the economics of America. To the UAW members who stayed strong the past few weeks, great job. You won a nice victory for blue collar workers period.
136
@The Nattering Nabob ...Now would be a good time to start bringing those high value manufacturing jobs back home too, like Trump promised.
1
@Misterbianco It would, wouldn’t it? Now, do you think it is going to happen? Like other things Trump promised, I’m not holding my breath.
Economies of countries which include large doses of corruption are rarely healthy. The Trump/Giuliani crew was trying to corrupt the Ukrainian economy, and now we see evidence that Trump is working on corrupting our own economy, with self-dealing, playing favorites, punishing political opponents, tariffs, etc. If businesses start to see further evidence that their success does not entirely rely on the quality and price of their own products, expect changes in business strategy which can't be good for future economic health.
40
@Nancy ,
Your point is very well taken. Economies strengthen as corruption is reduced. And vice-versa.
"Did anyone foresee Wednesday’s physical attempt to disrupt the House inquiry?" -P. Krugman
What is it with neoclassical economists and the obsession with predicting the future?
No one knows the future!!!
6
Wow! How could anybody have foreseen that anybody would use the mentioned sentence to be critical of Mr. Krugman?
1
In terms of removing Trump from the Oval Office, the end of the Trump boom is welcome news. As the smoke and mirrors of the Trump economy recede, more Americans realize that Trump only offers economic posturing, rather than real solutions. People who were willing to ignore Trump's failings when the economy looked limitless, are now more receptive to impeachment. By way of historical analogy, while it's true that Americans were appalled by Nixon's political malfeasance, they were also enduring stiff economic headwinds, including 9% unemployment. When the economy is that bad, people are highly critical of a president on all fronts. Little wonder Nixon decided to resign before he was impeached.
21
I don't wish for economic trouble (although I understand that cycles are inevitable). But if, as seems assured, President Trump's trade wars, tax cut, corruption and general ineptitude do produce a bad downturn in the economy, then I do hope that it comes soon, and quickly. Too often, changes in the economy come slowly enough that the actors who caused them are no longer around to pay the price.
82
@John Magee
My reaction to a downturn in the economy has been to cheer when the market goes down. I agree that I have hope that the fall comes quickly, not so much wanting them to pay the price as much as wanting this to end because the outcome could be more horrible than we could imagine.
16
"To be fair, the overall state of the economy is still pretty good. " Good for whom? Probably, Chilean economists have been saying the same thing about the economy there.
30
@John Williams ,
Dr Krugman is a professional has to be careful about what they say. But they choose their words carefully.
Among professionals, "To be fair, ..." means "I have to say this for professional reasons but, please, don't take it at face value."
And, yes, throughout Latin America economists have been saying "To be fair, ..." over and over for a long time.
The economic recession that Krugman and Democrats are hoping to occur eventually will happen, however it may not be on the time table they want in order to have an impact on the re-election of President Trump.
What is evident is that Democrats want whatever it takes to remove President Trump from office even if it means that a large population of citizens would suffer economically, which many are the same people on the cusp of economic stability who Democrats claim to want to protect.
3
@MDCooks8 - That is a warped thought process. It's not what we want, it is what is certain to happen given the huge deficit spending caused by this president, his tariffs, his "picking winners" via subsidy for his base while punishing his opponents' industries, and his radical unpredictability that will eventually cause serious problems for the economy.
81
@MDCooks8
Disagree. Many are like me, I suspect, thinking it unfair if a Trump-caused downturn occurs AFTER the election, allowing him to skate through 2020.
18
@MDCooks8
Really? Dems 'hoping' for a recession? There are a dozen bills sitting in the Senate that would put billions of dollars to work for things America needs. But Moscow Mitch won't allow a vote. His alternative? "Wait for the White House to give us a plan." He's waiting for the WH, not Democrats in the House who already have bills passed, while the economy tips into recession.
But it's the Democrats 'hoping' for recession?
Evidently, the word 'talk' is a foreign word at the WH because it seems to go only in one direction, and the other side isn't answering.
24
Wake me up when Krugman is right about something, anything. I remember Krugman said the market would collapse when Trump was elected.
5
@TL It takes a while for even a corrupt, incompetent president to damage an economy that is humming along like the one Trump inherited.
4
@TL
We still have 14 months to see that happen.
1
@TL What??? You're not going to bring up Enron? All the trolls do that. Did you miss the memo or something?? Get with it or they'll be paying you in Rubles (if not already).
(When Enron was flying high, "smartest guys in the room", etc, PK got some kind of honorarium or something talk w/ various folks there about whatever-it-was - probably the Asian meltdown. There's no indication he complicated the tight relationship btw Geo W Bush & CEO Jeff Skilling, who of course ended up in jail. Trolls often point out the short association of PK/Enron, never mentioning either Skilling or good buddy W, naturally).
Unfortunately for the country, Professor Krugman is correct--Trump and his erstwhile advisors are just not very astute. I use that word in preference to intelligent, some of them may indeed be intelligent (although it doesn’t appear so). They are narrowly experienced, inattentive, unimaginative, greedy for approval, and woefully inexperienced in any meaningful global economic way.
Trump himself knows only one aspect, and a narrow one at that, of business, that being reality TV show actor, yet, he thinks himself a genius.
What could go wrong here when complex global production lines, environmental safety, results, and the global economy are at stake and the person making policy believes they know it all?
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@Susan
As P. Krugman said recently, it's lucky that Trump is dumb.
For the cost of the tax cut, he could have bought a lot of giveaways for his adoring base
1
Business confidence was up so long as our business "leaders" salivated at the prospect of a tax cut. To lend it legitimacy, they parroted the canard that the cuts would boost a boisterous economy, while all it did was to boost their bank accounts. Gary Cohn, the Goldman Sachs mole, left as soon as he gave himself a cut, and CEO's have been stepping on the breaks since. Whatever upsurge in the economy we've experienced has been an extension of Obama's tepid recovery. It always amazes me to read that consumer confidence is up at the same time as consumer debt. It seems everybody would rather believe the rosy depictions in the media than their own lying eyes.
39
@stan continople
Just one point: the tepid Obama recovery was due to the obstruction of a much larger stimulus package by Moscow Mitch et al
The recovery would have gone like gangbusters had they not knee-capped President Obama.
Mr. Krugman is putting a lot of weight on interest rates being slow. The rates are high upon the expectation of growth, and low if slowness is seen.
One thing his economic "science" training never planned on is the federal government continually lapsing into fits of printing money and loaning it for nearly free. They don't expect softness. They expect HANDOUTS.
1
I have a request for Dr. Krugman.
I heard Trump's talk at the shale gas convention in Texas the other day, and he made it sound like the economy was simply incredible, with boundless progress already achieved and the likelihood of vast improvement to occur under his watch. Now we all know that Trump lies incessantly and we also know that statistics are fairly easy to manipulate to produce the best possible story. Statistics are facts, but based on the purview, shading, focus, and context-setting, they can tell very different tales regarding the same set of circumstances.
So, I would like to enlist Dr. Krugman's help in understanding the relevant economic statistics between now and November of 2020, in light of the sleight of hand we can expect from Trump and the Republicans. What are the meaningful metrics? What are the counterpoints to the statistics offered by the Repubs? How might one appropriately read between the lines? What are clear, demonstrable trends? And can this all be presented publicly, in as straightforward and clear a manner as possible?
I know this is a tall order. However, this will be the single greatest service he could provide to his needy country over the next year. By far.
Thanks for whatever of this you can do.
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@AM
Right. Unfortunately, we cannot believe any figures coming out of the WH, since they fire anyone who seems remotely competent.
12
@Erica A. Blair
The counterpoint to all the cherry-picked good economic news is the budget deficit. If I borrowed a couple of millions I too could spend like a millionaire. But sooner or later that would come crashing down. The press and right wing economists have stopped talking about the budget deficit and national debt - but both have exploded during this "Trump boom".
18
@AM
I agree with your request for useful metrics from Dr Krugman and others. You may find the work of Michael Porter and K Gehl on the impact of the political system on the US economy to be illustrative. Www.gehlporter.com
4
The writer's perception about the impact of Trump's trade dreams is much appreciated. I think too many economists and business reporters have under appreciated the damage. We have a president and his egghead advisor (Navarro) suddenly and haphazardly trotting out old-school tariffs, or threatening to do so with little clarity beyond "we'll beat them into submission." Never mind how and, especially when (in 10 years?). At the same time, Trump has shown that he's willing to do real damage to businesses (soybeans, steel prices for example.)
So it has seemed like common sense to think American business would at least pause, be cautious, make no big moves. I wonder how many business meetings have been consumed with the basic question: should we gamble or should we wait?
15
Mr. Trump is hurling the country into the unknown faster than seemed possible just a few weeks ago. As the late Hunter Thompson so memorably observed about Richard Nixon: "When the going gets tough, the tough get weirder."
Maybe the last month has made two themes apparent to business leaders.
First, we don't know how the Trump saga will end, or when. But whether it takes five days or five years to play out, Mr. Trump's decisions about every aspect of governing aren't going to get more predictable.
Second, we really don't know what he's capable of breaking internationally.
Nobody wants to find out, but any imaginary "worst case" keeps getting worse.
66
@Grennan
I'd bet that a year from now, the situation will be something we simply cannot imagine today. "When the going gets tough, the tough get weirder." LOL - yeah, like that. Ever read about 1935 Louisiana governor "The Kingfish" Huey Long?
6
@badman
A year from now? A week or month from now!
....and the Kingfisher's son, Sen. Russell Long, of the Senate office building.
I've always liked the fact that coincidence or not, the Bill Clinton character in "Primary Colors" had the same last name as the press secretary to the Long character in Robert Penn Warren's classic "All the King's Men".
1
It is unsurprising that the collapse in business confidence has occurred after a tremendous string of actions by the administration demonstrating a total lack of competence and coherence in economic policy.
What is surprising is that it took this long.
However, perhaps it took the vivid illustration of mendacity and venality, illustrated by the revelations around our dealings with Ukraine and Kurdistan, to help business leaders recognize that they have been dealing with a group that has no credibility on anything but pandering to their base.
57
As Trump's insufficiency becomes ever more apparent, confidence will slip at an increasing rate. Finally, we are seeing noteworthy, educated, experienced people come to the same conclusion. Trump has no idea what he's doing. He may be suffering dementia.
Unfortunately, his cabal retains control of the senate, the judiciary and the FBI so there's no easy way to extricate America from the republican based organized crime. Therefore,it falls upon the military to break ranks and save the nation from the 7 year old and his enablers.
Sooner or later an issue of such importance will threaten our nation and the generals will step in, refuse to follow Trump's orders, and the end of this macabre circus will finally be upon us.
We are in uncharted territory.
39
@Defense attorney ,
Real life isn't a movie. Sadly, you're hoping for a happy ending. In real life, there are no happy endings led by military officers.
1
It would have been helpful if these noteworthy educated experienced people had figured this out BEFORE they voted for Trump.
4
I was quite puzzled after Trump took office, when even the mainstream financial press was portraying the Trump economy as "booming," something they didn't do when the economy grew just as fast under Obama. How is it exactly that 2.4% growth in 2017 and 2.9% growth in 2018 is "booming" when growth of 2.5% in 2014 and 2.9% in 2015 was "weak"?
Since the beginning of official GDP data in 1930, GDP growth has been 138% better under Democratic administrations. That's a blowout for Democrats, like a basketball game with a score of 119 to 50. And yet the financial press and the mainstream media behave as if historical results show a blowout for Republican administrations. Policies producing greater inequality and less financial sector regulation and oversight will not produce superior results. Quite the opposite. We've seen that game before (e.g., Hoover, Bush Jr.)
456
@Jon Data without perspective is meaningless. FDR and Obama took the reins when the economy was tanking which gave them a low point from which to gain altitude. Further Dems governed during significant wartime efforts. These efforts bring significant government spending that floats the economy until the war winds down.
Our economy languished in the 30's and finally gained steam during the Second World War. After that war we were the last economic power standing which allowed us to take advantage of the Golden Economic Growth Era that followed through the early 70's.
In between we had the Cold War, Korea and Viet Nam. Dems reined during each conflict's ramp up, and Republicans during the wind down, of each of those situations.
If there is anything special about Trump's accomplishments I would say that his growth started at a higher base and has happened without war all during a global slow down. You may not appreciate the data, but we may just be the tallest midget in the room. And that ain't bad.
5
@Jon The economy is great because millionaires and billionaires got a big tax cut. I only buy food now.
18
Yeah, me too. These people who think the economy is so great infuriate me. I say we should switch our paychecks with theirs and see how great they think it is then.
30
Around here jobs pay minimum wage to $9.50 an hour. People say Oklahoma has a low tax rate but that's not really true. It's right in the middle of the country's average when it comes to property tax and it has a state income tax and it taxes groceries. Nobody gives you a discount because you live in a state with low wages. If I want to order something from Amazon, they charge me the same amount as they charge to somebody making a million a year.
People are working two and sometimes three jobs just to pay utilities, house payments, and rent. Between exhaustion and lack of money, nobody wants to spend. This is a hard way to live, working til exhaustion, lousy health insurance if any health insurance at all, and no money for treats or fun. There really is something to "all work and no play."
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@Linda
Exactly. What people don't seem to get is when the corporate tax rate is reduced fourteen percent, and regular people got a reduction of maybe three percent, those federal dollars going back to the states and municipalities were reduced, therefore creating a need for towns and states to raise taxes. And sales taxes and property taxes hit lower and middle income people the hardest.
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@Linda Amazon is one of the first company to raised minimum wage to $15 an hour and they offer good benefit. Amazon is not a perfect company but they always try to do the right thing as they learn and evolve. I love Amazon.
@Linda Lol you missed the point
13
Not only business confidence has collapsed. I think everyday Americans are also questioning what the heck is going on and feeling uneasy about the future.
Here in St. Louis - a fairly typical Midwestern metro - the number of homes for sale is currently 22.6% lower than this time last year. That's a huge number.... nearly 4700 properties NOT on the market compared to September 2018.
And why is that? Why are people staying put and not selling? Why has the inventory dropped so dramatically in the past few years and continues to get worse? Surely it's not because regular Americans are feeling confident in the future.
44
American political institutions are designed to provide one thing: certainty. Policy change is hard, there are multiple veto points, and major reforms are, accordingly, supposed to be quite rare. And yet trump is able to run roughshod over these institutions, unilaterally imposing taxes (tariffs) and reprogramming money (see the wall). I will never understand why an American president is able to unilaterally able to impose taxes and spend money. Yes I understand the legal basis, but those laws that allow this are clearly inconsistent with our political values and in particular congress as holding tax and spend authority. My vote at the federal level going forward is premised entirely on a candidates promise to vote to repeal these authorities that trump has revealed
27
@Mike
Hear, hear!
1
There are two differences between a Trump supporter and an economist. One follows numbers to determine the future. The other follows a conman. The other difference is that only the Trump supporters know they are always right.
101
Trump's trade war is not just with China, it includes the EU. Trump is out to destroy the global economy also with sanctions including sanctions against EU corporations. He is bragging how great the US economy is while all others are down.
When the global economy finally is in pieces what nations will have markets left for the US do business with? The ME already is in ruins and will be in ruin for many decades and longer. The Americas are in a mess and will be for decades to come.
To top it all, the US is militarily overexpanded, reducing the living standards of the working American middle class- people too.
40
@ARLM. I realize that it’s Trump, not you, who insists that the USA’s economy is doing better than all others, but all of you might want to take a look at your neighbour to the north. Canada’s economy is doing very well, in spite of Trump’s levying tarries on. Canadian aluminum.
Well: this is Trump at his best; "doing business the old way", like he did with his business: losing his shirt every year.
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@Dr. Ricardo Garres Valdez yes, it is Trump at his best. And his best is very far from what we need or adequate. I don't care if he loses his shirt every year. What i care about is how he's forcing the rest of us to lose along with him while he's laughing all the way to the bank.
1
House Democrats will be have to balance doing a thorough job of impeaching against the need to act with some speed in the hopes of limiting the damage Trump causes. Despite the need to stop or inhibit the damage that Trump does almost daily, the Articles of Impeachment should be inclusive enough that wavering Senators must confront the appallingly large number of high crimes and misdemeanors: election violations, Emoluments Clause violations, collusion with tyrants; foreign policy betrayals; lying; assaults against women; failure to protect Americans against threats such as Russian interference and climate change, .... Among the list, different Senators, in voting to remove, may then cite the crime they find most unforgivable -- or, if acquitting, must own the whole list.
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@Robert Enders Horrible policies (exacerbating climate change, for example) are not impeachable offenses. The predator-in-chief has never been convicted of assaulting women, and tangled webs involving payoffs to adult film stars are likewise unlikely to make the cut. The Articles of Impeachment need to be focused on high crimes and misdemeanors. They are clear, and the defendant-in-chief admits the illegal acts while claiming they are not illegal. If there are enough GOP senators left who are neither blinded by obfuscation nor terrified of losing their next election, there may be hope. I don’t share Romney’s political and religious beliefs, but I think it’s possible that according to his lights, he answers to God. It will be telling to find out how many of his colleagues answer only to Trump.
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@Robert Enders
What the Democrats do or don't do won't mean much when a significant part of the electorate doesn't think Trump did anything wrong, or if they do rationalize it away by saying "he only did what everyone else does". We're seeing the results of the decades long dumbing down of America and doing the right thing may not change a thing.
5
There is an English saying Make hay while the sun shines. The Trump boom was the time when the sun was shining and businesses made a ton of money during the boom and so did wall street investors with record highs. If they now decide to not invest that is their loss. The perception that confidence has collapsed is deceptive. I am sure there are plenty of investors buying good stocks at bargain prices. If business confidence is diminishing it is because businesses are playing it safe and want to hold on to their profits and laugh all the way to the bank.
5
@Girish Kotwal "The Trump boom"
More like a boom-let. It lasted all of 6 months until the rush of stock buy-backs faded and people had to get back to actually working to make money. yeah, I'm sure all the trump cronies made money. That is why and who the tax break was for, after all.
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I don’t know if you learned your English expressions in India or in Louisville but you clearly are clueless about what brought out this “boom.” If you cut taxes of the rich and corporations (sorry they are not people like some people from your party believe) by huge margins, the discounted of future earnings, which is called share holder value (stock price for long) goes up artificially. Pretty much as a function of the tax rate reducing the denominator.
Very soon reality catches up with financial engineering and first deficits grow, services are cut and it starts hurting the common folk! I don’t know what you are but let’s assume middle class. You will be hurting and if you or your loved ones get sick and you have lost your job because of the recession that arrives when you just are not expecting it, good look! And hope you are in good health because there isn’t much insurance coverage for unemployed or failed small businesspeople and their families.
Now go back to your English adages book and see if you find something about alchemy.
3
@Joe Rock bottom from California. The businesses got their loot during the Trump boom so the money is stoll sitting in their pockets. Wgar rge Trump boom did is it benefited millions of our fellow Americans who found jobs just in the past 3 years.
1
Of paramount importance is imagining what Mayhem 45* would do to keep his stay-out-of-jail immunity card by getting re-elected to 4 more seasons of Celebrity Apprentice: White House.
This week's episode had the mob of GOP'ers breaking into Congress's SCIF and the in progress deposition, taking in their phones - which normally causes people with such security clearances to lose those clearances.
Never mind that the GOP'er mob was just flat lying that they are shut out of the depositions, since there are 122 people (including 47 GOP'ers) from 3 committees hearing the depositions with both Dems and GOP'ers getting equal questioning/cross exam times.
It's utterly amazing to see what GOP'ers think is copacetic coming from the White House, and thus what GOPers will obviously unquestioningly condone when a Dem is back in that edifice - oh, wait (as Dr. K. would say).
79
When overall "new jobs" data are announced, does that take into account jobs lost during the same period? And if two new 20-hr part time jobs are created, does those count as one full-time job, or simply as two new jobs?
21
Dr. Krugman's comments seem reasonable enough, as far as they go. It would be useful, however, for him to comment on the uncertainties discussed in yesterday's Times by Dr. Naomi Oreskes and Prof. Nicholas Stern.
https://www.nytimes.com/2019/10/23/opinion/climate-change-costs.html
The underestimation of the breadth, depth, immanence, and costs of global heating surely create as much, or more, economic uncertainty as the flightiness of Trump's trade policy, particularly given his refusal to recognize the problem at all. Perhaps Dr. Krugman could illuminate us as to the extent this uncertainty factors into business investment decisions.
12
In addition to Wall Street's growing fear of the consequences of Trump's unpredictable and ill conceived actions, the WSJ points out that Wall Street is also afraid of Elizabeth Warren as the new president. It seems either way Wall Street will be hard pressed to preserve their profits.
9
@Eero Under Warren, their taxes and cost of regulation will be higher, but will be set by law and will be stable over foreseeable timelines. Under Trump, they may be quadrillionaires one day and (relatively) broke the next. Which do they prefer? And which is better for society?
31
@Eero - Good. Let Main Street prosper under Elizabeth Warren as the new president. And until she goes after the big banks, insisting on accountability, who would want to buy a house in this country?
10
@Eero
Let the "businessmen" who are constantly telling the world how smart they are and what they and their corporations accomplish actually work for those profits and expansion into new markets. Can't deal with safety regulations for employees or EPA regulations for surrounding communities? Try meeting the challenges of succeeding and not damaging the air, water and land. As a country, the USA has spoiled businesses with tax incentives and other inducements to succeed. Afraid of Sen Elizabeth Warren demanding performance from businesses? Try working and not playing golf.
If the businessmen of the USA need protective tariffs and other assistance to be successful, they should stop telling the world how great they are and how smart they are to back Trump who is they say business's dream president. No regulations, no taxes, incentives to succeed, cabinet posts filled with industry leaders. How much easier can it be to do well in the USA?
What I see is too many failing sectors that are looking for a hand-out from a government (state or federal) because they are being out-smarted by their global competition.
4
If the Trump boom has died, the stock market sure didn't get the memo.
In fact, there is probably no more positive leading indicator of a coming boom than a negative prognosis from Paul Krugman.
Another funny thing is that amid a global recession just about the only buoyant economy is ... Donald Trump's. How can that be when he has done everything wrong?
More than a year ago, the IMF World Outlook noted that growth had slowed in the euro area, Japan, and the United Kingdom."
In that same report, the IMF noted that the US was overdue for a slowdown. “Even U.S. growth is projected to decelerate over the next few years, however, as the long cyclical recovery runs its course and the effects of temporary fiscal stimulus wane”. Given the headwinds, Professor Krugman should have given Trump at least an A-. The president has amazingly managed to prolong one of the longest booms in history.
As usual, one of Krugman's ugly theories has been killed by a beautiful fact!
10
@Ian Maitland
He can not take credit for the upswing in the Dow, but he can be directly blamed for deep drops.
The economy right now is at a true standstill -- the market is not reflective of the true state of things.
As a former Wall Street analyst (and having lived through the October '87 crash) I am not alone in being nervous about another bust/boom -- but it's going to take a lot more than 45 to make it rise to something that will make the poor, richer.
35
@Ian Maitland
If you are using the stock market as an indicator of Trumps "great " economy, note the stock market is exactly where it was on Jan 2018. That is 22 months of zero growth.
41
@Ian Maitland In my opinion one reason that the stock market stays so high is that the bond market offers such terrible rates. All over America must be seniors like myself who would like a reasonably secure source of reasonably high income from our savings. Once upon a time, folks like us could find this in the bond market but we can't find it there any more because the interest rates are so low. Faute de mieux, we must invest in the stock market -- and this keeps the market high -- though actually it hasn't been going up all that much if you look at the Dow -- how long has it been vacillating between 25,000 and 29,000? Seems like forever it just keeps going up and down between those two "extremes." And when it hits "a new high," it's not by that much.
14
If the DNC had any sense- or money, they would start running ads right now in Ohio, Pa, Wisconsin, Iowa, Michigan. saying the following--
X thousands of manufacturing jobs lost in the state since Trumo took office, but giant tax cuts for the wealthy.
Rather than rely on Speaker Pelosi and impeachment, they need to go after the Obama to Trump voters in those states who voted on their pocketbook. They only need to turn 1% their way,
728
@Kevin Jordan I am sure that during the general election Democrats will do exactly that. Right now they are focused on the primary election and, yes, impeachment.
41
@Robert Why not both? We need to hit hard and often
37
I wish I could “like” your comment 600 times.
22
The Trump tax breaks led to corporate stock buybacks at an unprecedented level. This was already a very bad sign.
Corporations buy back their stocks when they don't believe there are investments in their backlog of projects that promise higher returns than simply reducing the number of shares, which boosts Earnings Per Share (EPS), and stock price. In fact, some companies borrow money to buy back shares rather than invest in their businesses.
It's also great in the short term for corporate executives, who are largely compensated in shares of stock.
Buybacks used to be illegal, because they were considered a form of market manipulation, but this changed during the Reagan administration. Sometimes it's referred to as "financial engineering" because it is a lever that can be pulled to hit an EPS target, once again, creating upward pressure on the stock price, benefiting executives.
Companies that have been overtaken by their Finance departments generally do this. Companies that are still
driving toward a vision usually don't. Example: Amazon.
Even the simplest analysis before the tax cuts were enacted would have predicted this resulting behavior.
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@Incontinental "Buybacks used to be illegal" Yes, buybacks are just a subsidy to the stockholders to keep them from selling. It is blatant market manipulation and distorts what is really happening at a company. But, the execs are happy because 75% or more of their "income" is stock options.
21
Trump’s economic boom is pure mythology. The reality is that most of us middle to upper middle income folks that have jobs have gotten sub par raises and bonuses while our health care and education costs have risen.
The economy is running on fumes as are the majority of people’s bank accounts. Unless you are in the millionaire class things have not improved economically under trump nor did they improve under Obama or bush.
The government no longer works for the people only well connected lobbyists and corporations who are too greedy to keep the majority happy. It’s time to purge money from politics or things will continue to get worse no matter who is in the White House.
153
@JR It's time to purge Repubicans from every level of government including Federal, state, country and local so our government can work for the taxpayers who support it.
141
@JR Spot on! We're living on credit cards, from paycheck to paycheck, and on sheer dumb luck. If the economy goes into a recession again (and it will), thanks to the lack of recovery for most working Americans, more than few of us will be in horrible financial straits. We'll lose our jobs. We won't have any savings. And the future will not be bright.
It should not have been this way. There was plenty of warning in the 1980s that systemic changes were needed due to the Baby Boom generation. Social Security needed to change in terms of the withholding. We ought to have been using that generation's most productive working years to ensure equal pay for women, make quality child care affordable for all, upgrade our wealth care system so that people wouldn't be dying because they can't afford a key medication such as insulin. And our legislators should have made a law regarding defined pension plans rather than letting corporations scrap them to save money and increase their profit margins.
Instead we have a crisis that won't end. The latter half of the Baby Boom generation is nearing retirement with little or no savings. Our children and grandchildren are not doing well. And our president is running the country into the ground morally, economically, and, dare I say it, spiritually.
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@JR you are absolutely spot on with this assessment. My sister, a 50-ish, well-educated, smart, hard-working, white-collar professional, has been out of work for a couple of years, despite applying to, literally, hundreds of job openings. She is about to go on public assistance. The two prongs of ageism and the rising cost of health care (especially for people her age) make her an unattractive hire despite excellent experience with top-tier companies.
As individuals and as a country, we have to stop faking normal here and realize that substantial policy changes, and new laws, need to be enacted, otherwise, we run the risk of several generations here in America going down the tubes while the 1% count their ill-gotten lucre.
28
This is all fine and good, but how much the state of the economy really matters to the outcome of the presidential election is doubtful. Trump voters chose him because he spews hatred toward women and minorities, and because of his ostensible attitude, his pose. The same will be true this time, if he's on the ballot again.
How much they "looked at their hole card" and calculated that he would serve their economic interests is questionable. Did they, do they even think in such terms? and if they do, what would make, or have made, anyone other than the super-rich think for a minute that Donald Trump was on their side?
32
@Just Ben "Did they, do they even think in such terms?" Even trump supporters admit he is lying most of the time. But they are mostly interested in his anti-immigrant rants, and the false claim that immigrants are taking their jobs (seen any trumpers working in slaughterhouses lately, or mowing lawns?). No, they just want to think they live in the 1940's again.
5
@Just Ben I agree. Almost no one really wants to admit it but it is his racism and misogyny that really attracted voters to him. Of course he still lost the majority of the vote, so there’s that.
9
Trump doesn't limit federal spending as a Republican is supposed to do. From a very recent Newsweek, "...federal spending hit a $3.7 trillion record and the budget deficit climbed to $867 billion so far this fiscal year." This can't be good. Although I don't wish job loss for any American, yes, we should be hoping the economy is not our current incumbent's friend come election time. And some of Trump's base come to there senses.
14
@Postcard Collector "Trump doesn't limit federal spending as a Republican is supposed to do."
Name the last republican that actually limited federal spending. Never happened. They just cut a few minor things and then blow out the budget on the military and wars.
The reason is because there are constituencies for every line in the budget and they fight tooth and nail for everything.
But Trump is cutting budgets for regulatory items - you know, not regulating air pollution, water pollution, safety at work, etc. That way they will claim to "save" money and can just ignore the people hurt and killed by their actions.
21
@Postcard Collector ...I'm not really very hopeful that there will be too many members of Fox Nation...who listen to Watters World, Hannity, Tucker,and Laura Ingraham,Levin etc, will be changing their minds. Some yes.. but not likely a landslide. These people have had a long and steady diet of Alternative Fact Fox Food...They couldn't go a day without their junk food diet! They're addicts !! Junkies would be an apt description !!
3
Trump won a squeaker. It won’t take much of a shift for him to lose. Personally I’m hoping all those Puerto Ricans who moved to Florida after the hurricane make their presence known. It would serve him right for what he did to them.
2
Isn't the primary economic uncertainty the question of whether we as a species will even survive more than a few decades from now? The specter of gloom goes as far as the eye can see for people who are paying attention to climate change and mass extinction of all species except cockroaches and rodents. Certainty for the markets? The only scientific certainty is that life as we know it will extinguish sooner rather than later if we don't respond Manhattan Project-style to the challenges at hand. And, currently, we have a president who is doing absolutely zilch. This does not create an inspiration for anyone to invest in the future. Storing food and water in the garage and hiding under the bed is probably the smartest economic model for current times.
21
The country is in peril under what has now become renegade Republican rule. Democrats have the awesome task of undoing the control of Donald Trump and his administration, which is staffed by ideological lackeys whose inability and unwillingness to create good policy has begun to take effect. Everyday life for most Americans has not changed noticeably at this point, but it surely will happen if Trump continues in office and the Senate remains in Republican hands.
This is no time for Democrats to seek power by offering a centrist candidate without big ideas to replace him. We need someone who is able to speak to the people in terms they can understand about what is being done and how it will affect us and one who will offer a clear alternative to this president, whose vision for this country is something we will not recognize nor imagine, nor want.
34
Consumer spending reached an all time record the 2nd quarter 2019. At the same time the right/wrong track for the country polls show wrong by about +25. Not sure those two can be like that for long.
7
Trump made promises he hasn't kept. One big one was to fund upgrades and repairs of our roads, bridges, and railways. Our physical infrastructure. We know it's important to get this done but we need funding from our government to accomplish this. It's not just local roads that need work: interstates, bridges on those interstates, airports, waterways, railroads, etc. We cannot continue to be a good place to do business if our infrastructure is falling apart. Trump can blame Pelosi all he wants but he is the one with the power to act. He hasn't.
He hasn't proposed a better health care plan. He hasn't done any better on trade policy than his predecessor. He has actively undermined his own appointees, the government, government agencies, etc. Trump and his cronies have done everything possible to ruin America. But the GOP continues to support him and them and their policies. I guess their idea of a good president is one that is not named Obama.
His easy to win trade war has made it impossible for businesses to plan. His rolling back safety and health regulations is not the boon he sees it as. His constant inappropriate tweets do nothing but cloud the issues. He is, in short, a failure as a businessman and as a president. He has not improved anyone's life but his own and that only because he's now living rent free in the White House. I vote for a new tenant, one who is not so in love with himself.
10/24/2019 5:37pm first submit
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@hen3ry Excellent comment. My thriving business relied on customers being able to travel across a short, but critical, stretch of roadway with a bridge. Whenever this stretch was closed or under repair my income dropped an average of 25%. Road closings for temporary fixes began to happen more and more often. When it came time to renew my lease I trusted my instinct that the long term, promised infrastructure repair was not going to come. Although it was a personally painful and financially costly decision to close, it would have been worse if I had made my decision based on political promises. The bridge has now been closed for years and the town I was in has lost half its population.
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@hen3ry What you mention would make excellent kernels for Dem election ads. I wonder if anyone's left minding the store, or are they all waiting for the next tweet to drop?
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@Molly Bright ( and hen3ry)
Both show the collapse of our once modern industrial road/rail/water transport systems.
We're 3rd world now, passenger tranes in E and A travel at 100 mph + and ours do 60 ( when the track is not being rebuilt and we slow to 40 )
Simple answer is we spent the money abroad on military and they ( E & A) spent the money at home.
Its a huge 20 year project and needs to start with a new congress and a natl. approach to infrastructure. ( US congress needs to vote on Natl. funding approach , get rid of regional politics)
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You mean the Trump Boom didn't die on election night, 2016?
Because I distinctly recall Paul Krugman predicting that night we were entering a recession from which we'd "never" recover.
Here's a direct quote from the brilliant economist: "We are very probably looking at a global recession, with no end in sight. On economics, as on everything else, a terrible thing has just happened."
Since that night, unemployment has reached levels not seen since the 1960s, inflation has remained historically low, economic growth has been much more robust than under the previous administration, and working people with 401(k)s on which they hope to retire have reaped a windfall.
Virtually every day of that time, you've doubled-down on your election night hysteria, Paul. Well, I guess like the blind hog finding an acorn now and then, you'll be right eventually. Just keep rooting for economic pain for the average American to fulfill your visceral hatred for a president.
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@Philboyd If you were arguing in good faith, which you are not, you would point out that Krugman acknowledged his mistake within several days, retracted it, and explained why he made that mistake, and has learned from it how to improve his predictions in the future. That is more than any conservative economist has done in the past 20 years.
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@Philboyd It looks like Mr. Krugman was at least partially correct, we are entering into a point if not economically then at least socially that we might "never recover" from. I cannot remember a time when I have ever been so saddened by the current state of affairs in our country and this isn't said with hate, it is said with abject fear.
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@Philboyd
I'd say Dr. Krugman was correct, but his timing was way off - which in market forecasting is a tad important.
Paul was apprehensive that an irrational sociopath would do something like make a deal with malefic foreign actors to hurt the United States. That came to pass.
I don't think Dr. Krugman could imagine a third of the populace sitting on their hands while Trump participated in so many scandals - with the blessing of the Senate.
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1. If massive infrastructure spending has not been forthcoming, then the repair and rehabilitation of water and road systems is only more urgent now than four years ago, and we are closer to shocky failures. A couple of outstanding failures will collapse bond ratings everywhere. Money may be cheap now , but that doesn’t mean there will be eager lenders. See California.
2. Look at how fast WeWork valuation has collapsed. Special case? No, one example of the General case of insufficient scrutiny. Twitter value could fall 20% on just 1 day, today? Twitter?
3. The housing shortage crisis has not been addressed, and nobody seems willing to do begin to do so. Fraction of wage-earner income to rent leaves little left for other spending.
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Business investments under this instable president are often held back. How can one plan, when what is said today might not be true tommorrow. This will ultimately lead to slower economic growth, which could be a big benefit for democrats in the next election.
I agree with Mr. Krugman that next years´s election should be about Mr. Trump´s betrayal of the constitution and low moral values. Combined with slow economic growth, it will hopefully be enough for a democratic candidate to suceed.
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@Martin
In many cases the comment changes every few minutes.
I would argue that the impeachment inquiry will result in the House forwarding articles of impeachment to the House and that there will be a Senate trial.
While it is certain that there will not be enough votes to turn Donald Trump out of office, the spectacle of a president being tried for offenses that may range between obstruction of justice to abuse(s) of his office for personal gain to outright treason will not bolster the confidence of Wall Street in any of the president’s attempts to drive business. In fact, the opposite is likely to happen.
The president has milked the Obama cash cow for all it’s been worth and now he has to run on his own record, not simply that of the man he hates with all his heart.
Donald Trump may survive a trial but he’ll be a broken president, having escaped a Senate conviction but certainly held, by an overwhelming majority of citizens, to have been treated leniently by a friendly Senate. The prestige of the office has been eaten away by his tenure, much like the goodwill that should have been his but for his belligerent assumption of power. His missteps in foreign policy, including Turkey and Syria and North Korea, have clearly demonstrated a man who’s been unable and unwilling to market America, interested only in marketing himself.
His unnecessary jousting with China has been revealed as empty blustering. Farmers and ranchers are on the dole, gladly accepting assistance that they recently used as a weapon with which to scorn others.
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@Red Sox, ‘04, ‘07, ‘13, ‘18 My current theory is that Trump will not be running in 2020, for whatever reason – resignation, removal by the Senate, denied the nomination, choking on a cheeseburger... Too much has gone wrong, it is being exposed and will gain wider exposure, and he's still got many months ahead of terrible decisions and behavior. The economy is probably the least of our worries.
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@Red Sox, ‘04, ‘07, ‘13, ‘18 My current theory is that Trump will not be running in 2020, for whatever reason – resignation, removal by the Senate, denied the nomination, choking on a cheeseburger... Too much has gone wrong, it is being exposed and will gain wider exposure, and he's still got many months ahead of terrible decisions and behavior. The economy is probably the least of our worries.
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@Red Sox, ‘04, ‘07, ‘13, ‘18
Well said. Well said.
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It’s noteworthy that as impeachment evidence looks worse daily, the stock market has been soaring. That could mean Trump is losing his argument that if he is not reelected, the market will dive. Perhaps Wall Street and corporations are signaling that the nation can jettison Trump and all will be well without his erratic, corrupt presence in the Oval Office.
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@Lest We Think For what it’s worth, historically both the stock market and the economy as a whole have done better under Democrats. We don’t know if that’s a causal relationship or a coincidence, but there’s certainly nothing in the historical record to back up dire warnings about what will happen if Trump loses. And it’s worth noting that even Elizabeth Warren is only proposing to raise taxes on the rich back to about what they were during the Eisenhower administration.
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@Lest We Think
Soaring ? To which stock market are you referring ?
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@Paul Krugman You must've forgotten the dot-com bust in March of 2000 under Clinton where up to $10 TRILLION in wealth was lost. No, the stock market hasn't done historically well under Democrats.
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The surprising thing to me is that so many 'business executives' bought and sold the idea that bloviation, hucksterism and huge deficits run up just to enrich a tiny percentage of the overall economy would work. Fraud doesn't work. It never has, it never will. Perhaps the idea was simpler -- pump and dump. In New York, little Donnie was always known as "Pump and Dump Trump."
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@T
Since business executives are part of that "enriched" "tiny percentage", they had a strong incentive to have "bought and sold" the "hucksterism".
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@T -- Perhaps, those vaunted 'business leaders' are hucksters too. I can't say that any of them are impressive when all of them are in it for the short-term money … a lot like the Trumpster. Even the tech visionaries have lost their edge. FB and Google are now the 21st century GM -- selling as fast as they can.
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@Marx and Lennon
the big scam from the white house, it's administration and congress is cover for the little ones.
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I'm not so confident that the average MAGA voter will be swayed by bond yields and global trade issues. These are people who have already shown their willingness to ignore facts and logic and vote for a lying conman promising to bring back coal, etc.
And given the GOP's mastery of gerrymandering, dirty tricks, voter suppression and taking full advantage of the majority-thwarting Electoral College -- all with the help of their comrades in Russia -- it will be an uphill struggle no matter the state of the economy.
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@Pat and good part of his base is uneducated and not very wealthy (more like poor)...so doubt they have much in the way of market holdings.
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I'm pretty sure that most trump supporters don't even know what a bond is...
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@Pat You are correct. These people are not NY Times readers, or most likely news readers at all. The intellectual crowd, Krugman, et al, no matter how correct they may be have no bearing on Trump voters. Voting is an emotional decision, not an intellectual one. Until they feel pain in their lives, they aren't changing. 2020 will be a very tough slog for the Democrats.
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Anyone who has been paying attention foresaw stunningly bad republican behavior. This is not new. The party has been going off the rails for at least 25 years. So no I was not surprised by the republicans storming a hearing yesterday. A hearing that about 1/3 of storming republicans were allowed to attend.
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@Bill smith
For the sake of democracy and civilization, can a rich Democrat just buy off these Republican cowards?
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@Bill smith Since trump treats everything like a un-reality show what the Pubs did by storming in was theater and very poor theater at that.
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Brainy Silicon Valley moguls who supported Trump as a disruptor may be having second thoughts. They probably were probably envisioning something a little more structured than endless irrational chaos.
Some business types who find Trump personally distasteful but have been willing to hold their noses so long as the economy stays hot are likely thinking about jumping ship. Their absolute numbers are not great, but they control a lot of investment assets and their opinions are accorded great weight. A real downturn will bring about their defection, and it will have a visible political effect.
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Until public sentiment shifts in the red districts, it is still Trump's election to lose, and Republican politicians and candidates will stick to him like glue.
Unfortunately those red districts are also stuck in the Fox News bubble, so they will be unlikely to shift much anytime soon.
Beware if Fox News starts calling for action in the streets. It could be the beginning of the end of life as we know it in this country.
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@Ralph Bouquet
This does tell us the target when Democrats get control again: Reinstate the Fairness Doctrine in a strong enough form to eliminate 24/7 fear-hate broadcasting.
It would also help to terminate Rupert Murdoch's U.S. citizenship.
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@Thomas Zaslavsky
Most people do not know what the Fairness Doctrine was or how it created what we know (or knew) as journalism in this county. The fairness doctrine required all broadcasters to provide a news program for free as part of their obligation to the public good. It required every news program to give both sides of any opinion. If a spokesman for the right was allowed to speak the program had to give the exact same number of seconds to a spokesperson from the left at no charge. Obviously news programs became very fact oriented and the American people were given both sides to every issue. The fairness Doctrine would drive Fox News into bankruptcy today. This all important regulation was repealed by... Ronald Reagan (who else?) after over 35 years of producing the highest quality public information of any country. Todays 24/7 propaganda channels and the chaos they create in our elections is a direct result of taking fairness out of news programming. Because who needs fairness anyway? Certainly not flimflam con artists who are trying to steal jobs and take away pensions. Certainly not people who label the biggest theft of money from the peoples Treasury as "Tax Reform". The cure for all the ills of our social media world has always been there but it has been repealed. All we have to do is take it out, dust it off, and save America. What are the odds that the conmen in charge today want to do that?
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@Bobotheclown
Thanks for the short tutorial, which as you said is probably needed by most Americans. I think your account of it is too sunny. First, the left never had any time. You probably mean liberals, those in the center or slightly left of center. Second, I don't believe there was any equal-time provision. It wasn't a metered requirement. But otherwise, you are perfectly right, and I have to think Reagan's advisors were quite far-seeing, as their abolition of the Fairness Doctrine has played a big part in raising the crazy right-wing wolf in our midst.
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It is now stunningly obvious that Trump must go, and as soon as possible. Unfortunately, removal by the Senate remains all but unthinkable, notwithstanding some (very) faint signals of heretofore invisible principles and courage. So Trump will need to be deposed at the polls.
Anyone who thinks this will be easy either has not been paying attention or does not understand American Presidential politics.
In that sense, this article by Professor Krugman is doing a disservice. Next year's election will be very, very close. The determining factor will not be Trump's outrageous behaviour, or the state of the economy, it will be voter turnout. And voter turnout is being determined now, as voter registration deadlines approach.
For the sake of the country, every American needs to register to vote (now!), educate himself or herself on the issues, and vote.
Those seeking to re-elect Trump, including Trump and Putin, are trying their best to depress voter turnout. After years of work, they have been stunningly successful. This bodes well for Trump's reelection campaign.
I only pray that there are enough Americans left who care.
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@R.S. I care, and I will crawl over broken glass to get to the polls if need be. Let's hope that like-minded folks in Pennsylvania, Wisconsin, and Michigan do the same, because it is the electoral college that matters.
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@mountainone
Exactly correct. HRCs campaign bungled the Electoral College math and lost the election despite receiving millions more votes. Democrats have got to play smarter, and that means turnout where it counts.
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@R.S.
I'm not sure how this article does anyone a disservice.
If by exposing the illusion that the economy is going strong Dr. Krugman provides information that motivates people to register and vote, isn't that good for everyone?
I'm mystified by this comment, but in the end, I think we agree that getting people out to vote is a good thing. Thanks.
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