All bluster on trade
President Trump loves to claim the nation is living through "the Greatest Economy in American history!"
But job growth was higher in President Obama's second term. The growth in gross domestic product, a standard measure of economic performance, is "about the same as it was to this point in Obama's second term," according to The Washington Post.
And this year, U.S. manufacturing has fallen into an official recession, recording two successive quarters of negative growth.
These facts produce a politically explosive possibility of blue-collar Trump voters revolting against his failed economic promises heading into the 2020 presidential election.
The president stirred up populist passions in 2016 with talk of bringing manufacturing industries, coal mines and steel mills back to life. The heart of that pledge was his call to get rid of the North American Free Trade Agreement (NAFTA), a trade agreement with Mexico and Canada that Trump called "one of the worst trade deals ever." Last week, the House passed a Trump-backed replacement for NAFTA, the United States-Mexico-Canada Agreement (USMCA). And the Senate, caught in Trump's grip, is highly likely to pass the bill in January.
So, will the new deal produce a spike in manufacturing jobs or increase stagnant wages? The U.S. International Trade Commission says the USMCA will only result in a modest 0.35 percent GDP growth and fewer than 200,000 jobs after six years.
And economists across the political spectrum predict prices will go up on cars, for example, without producing a big jump in manufacturing jobs.
I know what Republican readers are thinking - there goes another Trump critic, trying to deny the president a victory as he heads into the 2020 campaign.
Oh, really.
Well, listen to Stephen Moore, the conservative economist and a man Trump wanted to put on the Federal Reserve earlier this year. Asked in a September C-SPAN interview whether the USMCA had "drastic differences" from the current NAFTA deal, he replied, "Not really."
And here is Sen. Pat Toomey (R- Pa.) on NBC's "Meet the Press" earlier this month: The new deal "has all kinds of new provisions to diminish trade, and that's why I hope Republicans reconsider this."
Senate Majority Leader Mitch McConnell (R-Ky.) is not exactly happy, either. "From my perspective, it's not as good as I had hoped…but we'll have to take a look at the whole package," McConnell said last week. So, why are McConnell and other Republicans making excuses for a bill they don't like?
The answer is: Fear.
The GOP is backing this bill out of fear that if it doesn't quietly go along, Trump is capable of doing a head-first dive into America Firststyle economic protectionism. In other words, he is capable of killing any trade deal with Mexico and Canada. That would damage the U.S. economy - and hurt Republican prospects in the 2020 elections.
Even in the face of those threats, the free traders who write conservative editorials for The Wall Street Journal can't hide their discontent with the current political reality.
"The shame is that in many respects the new deal is worse than NAFTA, especially its bows to politically managed trade," the Journal editorialized last week.
"The new deal…raises the cost of manufacturing, making North American products less competitive worldwide," the editorial said, after explaining that they see themselves doing "damage control," in the face of Trump's protectionist instincts. The bottom line is that the president has succeeded in muzzling conservative critics of his economic policies.
That's why Congressional Republicans have little to say about how the president's tax cut sent the lion's share of its benefits to people and companies in the top income brackets - not to middle-income wage earners. And they have only silence when it comes to the nation's ballooning deficit as a result of the tax cut and increased spending under Trump. Trump's specific failure to deliver for blue-collar workers is being hidden by the GOP out of fear that it is too late to be honest with voters about Trump's empty bluster.
If they dare challenge him on his failed economic promises, he will remind them that he is their best bet to keep a Republican in the White House. The president's hunger for any new trade deal with Canada and Mexico led Speaker Nancy Pelosi (D-Calif.) to tell her caucus last week, "We ate their lunch." She was referring to changes made to the bill at Democrats' behest that attracted more support from unions.