Monday , October 23 2017
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Dude, Where’s My Policy?

Summary:
What Trump has done or tried to do over the past two years — wait, it’s really only been two weeks? — is incredibly bad. But spare a bit of attention to what doesn’t seem to be happening. Has anyone heard anything, anything at all, about domestic policy development? Remember, after the election Wall Street decided that we were going to see a big push on infrastructure, tax cuts, etc.. Some analysts were warning that progressives should be ready for the possibility that Trump would engage in “reactionary Keynesianism.” Worrying parallels were drawn between Trumpism and autobahn construction under you-know-who. But if there’s a WH task force preparing an infrastructure plan, it’s very well hidden; maybe they’re waiting to figure out how to turn on the lights. Seriously, I’ve been saying for a while that there will be no significant public construction plan. Wall Street economists, at least, are starting to catch on. Meanwhile, that Obamacare replacement is … still nowhere to be seen, with GOP Congresspeople literally running away when asked about it. Big tax cuts — and savage cuts to social programs — are still very much on the Congressional Republican agenda, and they could put it all together, hand it to Bannon, and have Trump sign it without reading.

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What Trump has done or tried to do over the past two years — wait, it’s really only been two weeks? — is incredibly bad. But spare a bit of attention to what doesn’t seem to be happening. Has anyone heard anything, anything at all, about domestic policy development?

Remember, after the election Wall Street decided that we were going to see a big push on infrastructure, tax cuts, etc.. Some analysts were warning that progressives should be ready for the possibility that Trump would engage in “reactionary Keynesianism.” Worrying parallels were drawn between Trumpism and autobahn construction under you-know-who.

But if there’s a WH task force preparing an infrastructure plan, it’s very well hidden; maybe they’re waiting to figure out how to turn on the lights. Seriously, I’ve been saying for a while that there will be no significant public construction plan. Wall Street economists, at least, are starting to catch on.

Meanwhile, that Obamacare replacement is … still nowhere to be seen, with GOP Congresspeople literally running away when asked about it.

Big tax cuts — and savage cuts to social programs — are still very much on the Congressional Republican agenda, and they could put it all together, hand it to Bannon, and have Trump sign it without reading. But I’m starting to wonder: surely they planned to unveil things during the Trump honeymoon, with the public prepared to believe that it was all done with the little guy’s interests in mind. Even pre 9-11 Bush could count on media goodwill and supine Democrats to ram through his tax cuts.

But now? With massive public distrust, and media fully willing to do real reporting on the distribution of tax cuts, not “Democrats say that the rich are the big winners”? With the media infatuation on Serious, Honest Paul Ryan at least temporarily dented by his avid support for Muslim bans and all that? Maybe they’ll do it anyway, but it seems a lot less certain than it did in November.

At this point I’m starting to wonder whether there will be any real movement on economic policy, as opposed to random insults aimed at allies.

It’s odd that the markets are, so far, not reflecting any of this; they’re basically unchanged from the levels they reached after the initial Trump Boom euphoria. But surely the odds have shifted, and there’s now a real possibility that on domestic policy, at least, we’re in for a period of sound, fury, and tweets signifying nothing.

Paul Krugman
Paul Robin Krugman (born February 28, 1953) is an American economist, Distinguished Professor of Economics at the Graduate Center of the City University of New York, and an op-ed columnist for The New York Times. In 2008, Krugman won the Nobel Memorial Prize in Economic Sciences for his contributions to New Trade Theory and New Economic Geography.

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