Diary

Trump: Right on Policy

So much noise. To supporters, nearly every day is Christmas; to opponents, every day is another chance to resist. Sleep-ins in the Senate; riots in Berkeley; open war with the media; Soros-sponsored demonstrations; orchestrated legal challenges; endless phone calls, meetings, and pronouncements. The man may be badly flawed. The process may be chaotic and the pace unsustainable. Priorities may be unclear. The Democrats may be succeeding in delaying the formation of his team. But, the man is fearless, right on policy, and getting results. As the kids in Silicon Valley are wont to say, “Trump is a disrupter”. Consider:

1. Trade policy. Republicans and Democrats had both accepted the premise of a debilitating and unsustainable $730 billion per year trade deficit in goods and services – $350 billion with China; $60 billion with Mexico; $65 billion with Germany; $69 billion with Japan; $28 billion with South Korea.

There are advantages of the status quo: cheap stuff for American consumers produced with cheap labor; profits for American companies who import cheap stuff and operate in foreign countries; willingness of foreign governments to use the American dollar as the “global reserve currency”; conformance with “comparative advantage” economic theory in which all are best off if each country focuses on what it does best; the good feeling of globalists as hundreds of millions in China and elsewhere rise from poverty.

But the real result is levelling – reducing America to raise others. $730 billion is 4% of our $18 trillion Gross Domestic Product. Ample attention is given to the five million manufacturing jobs which have been lost since 2000, as thousands of factories have been closed, but the problem is even deeper. With GDP growing at 2%, each year we are selling companies, real estate, or cash to make up the difference.

Even without his Commerce Secretary and Treasurer, Trump has cancelled the Trans Pacific Partnership, started the renegotiation of the North American Free Trade Agreement, and convinced several manufacturers to shift production to the United States. Critics note that jobs are also lost to technology, but Trump will move mountains to accomplish what can be done.

2. Immigration. “America First” changes the discussion toward the Canadian model of accepting immigrants who bring needed skills or resources to Canada, and away from the US model of focusing on what is good for the immigrants. It is a difficult shift, with the Democrats long term strategy of maximizing their voter base, and only Trump had the courage to face it head on.

Even without his Attorney General, Trump has issued an executive order to: secure the southern border, detain individuals suspected of violating immigration laws, expedite claims of eligibility to remain, and remove those whose claims have been lawfully rejected. Ever the Marine, Homeland Security Secretary John F. Kelly told Congress ““I work for one man. His name is Donald Trump. He has told me one thing: ‘Secure the border.’” There are details of border patrol staffing, expansion of detention facilities, expediting of legal proceedings, and specifications of a physical barrier, but the ball is rolling.

The liberal 9th Circuit Court in San Francisco has temporarily stopped Trump’s effort to halt immigration from war zones where adequate vetting is not possible – substituting it’s judgement for the President’s – but the defeat is temporary, to be overturned by the Supreme Court, or followed by a revised order which is better drafted. The ruling also highlights the desirability of appointing federal judges such as Neil Gorsuch who apply the constitution and the law rather than overturning politivcal decisions. There will be “extreme vetting”.

3. Free riders. The domestic press has made much of Trump’s call to eliminate or update the “obsolete” North Atlantic Treaty Organization. Of the 28 NATO countries, only the US (3.1%), Greece (2.4%), Poland (2.2%), the UK (2.1%), and Estonia (2.0%) meet the agreed military spending requirement of 2.0% of GDP, despite the threats posed to Europe by Islamic terrorists and by Russia. As part of her conversation with Trump, Angela Merkel (1.2%) has acknowledged that this must change.

Globally, we have 150,000 of our 1,300,000 military personnel stationed overseas in a posture which hasn’t changed much since 1946 – 49,000 in Japan, 38,000 in Germany, 35,000 in the Middle East, 27,000 in South Korea, 11,000 in Italy, and 10,000 in Afghanistan. In his waning days, Barack Obama agreed to establish a permanent US military presence in Poland. Trump has called for 30 day “readiness review”, as part of a broader plan to upgrade the military. Real action will await the appointment of his Director of Office of Management and Budget and his Treasury Secretary in addition to his Defense Secretary. Expect not only an increase in military spending, but also a reconfiguration for the 21st century.

The media pushes for detailed proposals on taxes (lower; simpler) and healthcare (repeal and replace) before Trump’s Secretaries of the Treasury and Health and Human Services are approved. Thankfully he is waiting, while he deals with simple things like the Supreme Court nomination, chipping away at Dodd-Frank’s financial regulations, approving pipelines, and just generally serving as Santa Clause for those who had (almost) learned to accept the premise of the last decade that America’s best days were behind us.

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