What the jobs numbers mean for the Republican agenda

The Wall Street Journal reported Friday:

“The U.S. economic expansion is now the third-longest on record and showed no signs of letting up in February, with robust hiring, falling unemployment and firmer wage growth opening the way for the Federal Reserve to raise short-term interest rates.

“Fed officials have signaled that their third post-financial crisis rate increase would be highly likely at their policy meeting next week. Friday’s report from the Labor Department offered much to strengthen their resolve.

“Nonfarm payrolls rose a seasonally adjusted 235,000 from January, exceeding forecasters’ expectations, and the unemployment rate ticked down to 4.7%. Average hourly earnings in the private sector rose 2.8% from a year earlier, a sign that the tightening job market is pushing employers to raise pay.”

Typifying the utter dishonesty and cynicism of President Donald Trump, his press secretary Sean Spicer, asked if the president still believed the Bureau of Labor Statistics numbers were fixed and the “real” unemployment rate was astronomically high, replied, “I talked to the president prior to this (briefing), and he said to quote him for this, ‘(The jobs reports) may have been phony in the past, but it’s very real now.’” He then laughed.

Yeah, a real laugh riot, that Spicer. Actually, his reaction wasn’t funny or cute or clever; it demonstrates that Trump took his voters as fools and continues to manufacture his own reality to serve his political ends.

Aside from reaffirming the president’s inherent dishonesty and contempt for the truth, release of the jobs numbers should cause Republicans — and would cause an honest administration -- to rethink their rather radical agenda. The economy Trump inherited had signs that wage growth is finally under way. President Barack Obama, to his credit, did not disrupt two initiatives begun by President George W. Bush — stabilizing the financial system and saving the car industry. Other than expiration of a sliver of the Bush tax cuts, we saw stalemate between Congress and Obama on taxes and spending. The economy, it turned out, did not need Stimulus II or other extreme measures. Slowly and steadily, the economy improved. We’d like faster growth, but the economic sky is not falling.

All Trump needs to do is, to borrow a phrase, “not do stupid stuff.” Trump has already eliminated a bunch of regulations, which he claims will accelerate growth. Maybe that’s true to some extent, but why then do we need a mammoth tax cut that will add trillions to the budget deficit and once again give the lion’s share of the cuts to the rich?

This seems precisely the right time to undertake revenue-neutral corporate tax reform to get rid of loopholes and gimmicks so the rate can be broader and lower. Beyond that, the argument for individual tax reform gets weaker with each month of positive job numbers. Setting off a gusher of red ink and exacerbating income inequality should be the last things we try.

And what about Trump’s trade policy? That too was premised on the notion that foreigners are “stealing” our jobs. But we are nearing full employment, so why get into a trade war with overseas countries that buy our products and services? If anything, we should be fueling the economy with new trade deals with Asia and Britain. Trump’s trade adviser Peter Navarro’s protectionist utterances and opeds have made him a laughingstock. Someone should explain to Trump that Navarro’s economic theory, namely mercantilism, went out in the 18th century. As recently as the 1990, we had substantial economic growth and rising trade deficits. With only 25 percent of the world’s gross domestic product, we need to sell more to the rest of the world and in turn see it invest those dollars back in the United States.

If the administration wants to “do something,” the president and Congress should turn their attention to bolstering human capital — school reform, worker retraining, diversified post-secondary options — and some basic infrastructure repair. These are long-term investments in our economic future. In short, if the job numbers are in fact “very real,” Trump’s economic agenda is very irrelevant and unwise. Trump should follow the first rule of economic policy: do no harm.