Go to Original
By Rajan Menon
Donald Trump’s supporters believe that his election will end business as usual in Washington. The self-glorifying Trump agrees and indeed his has, so far, been the most unorthodox presidency of our era, if not any era. It’s a chaotic and tweet-driven administration that makes headlines daily thanks to scandals, acts of stunning incompetence, rants, accusations, wild claims, and conspiracy theories. On one crucial issue, however, Trump has been a complete conformist. Despite the headline-grabbing uproar over Muslim bans and the like, his stance on national security couldn’t be more recognizable. His list of major threats -- terrorism, Iran, North Korea, and China -- features the usual suspects that Republicans, Democrats, and the foreign policy establishment have long deemed dangerous.
Even if you work and bring in wages above the poverty line, you may still barely be getting by. Oxfam reports that 58 million American workers make less than $15 an hour and 44 million make less than $12 an hour. Congress last raised the minimum hourly wage to $7.25 in 2007 (and even then included exceptions that applied to several types of workers). That sum has since lost nearly 10% of its purchasing power thanks to inflation.Trump’s conception of security not only doesn’t break the mold of recent administrations, it’s a remarkably fine fit for it. That’s because his focus is on protecting Americans from foreign groups or governments that could threaten us or destroy physical objects (buildings, bridges, and the like) in the homeland. In doing so, he, like his predecessors, steers clear of a definition of “security” that would include the workaday difficulties that actually make Americans insecure. These include poverty, joblessness or underemployment, wages too meager to enable even full-time workers to make ends meet, and a wealth-based public school system that hampers the economic and professional prospects, as well as futures, of startling numbers of American children. To this list must be added the radical dangers climate change poses to the health and safety of future citizens.Trump may present himself as a maverick, but on security he never wavers from an all-too-familiar externally focused and militarized narrative.Conjurer-in-ChiefBarack Obama wrote a bestselling book titled The Audacity of Hope. Perhaps Donald Trump should write one titled The Audacity of Wealth. During the presidential campaign of 2016 he morphed unashamedly from plutocrat to populist, assuring millions of people struggling with unemployment, debt, and inadequate incomes that he would solve their problems. The shtick worked. Many Americans believed him. Fifty-two percent of voters who did not have a college degree chose him. Among whites with that same educational profile, he did even better, winning 67% of their votes.Unemployment, underemployment, stagnant wages, and the outsourcing of production (and so jobs) have hit those who lack a college degree especially hard. Yet many of them were convinced by Trump’s populist message. It made no difference that he belonged to the wealthiest 0.00004% of Americans, if his net worth is the widely reported $3.5 billion, and the top 0.00002% if, as he claims, it’s actually $10 billion.Former Louisiana Governor Huey Long, perhaps the country’s best-known populist historically speaking, was born and raised in Winn Parish, a poor part of Louisiana. In the 1930s, his origins and his far-reaching ideas for redistributing wealth gave him credibility. By contrast, Trump wasn't cut from humble cloth; nor in his present reincarnation has he even claimed to stand for the reallocation of wealth (except possibly to his wealthy compatriots). His father, Fred Trump, was a multimillionaire who, at the time of his death in 1999, had a net worth of $250 million, which was divided among his four surviving children. The proportional allocations are not publicly known, though it’s safe to assume that Donald did well. He also got his start in business -- and it wasn’t even an impressive one -- thanks to lavish help from Fred to the tune of millions of dollars. When he subsequently hit rough patches, Dad’s connections and loan guarantees helped set things right.A man who himself benefited handsomely from globalization, outsourcing, and a designed-for-the-wealthy tax code nonetheless managed to convince coal miners in West Virginia and workers in Ohio that all of these were terrible things that enriched a "financial elite" that had made itself wealthy at the expense of American workers and that electing him would end the swindle.He also persuaded millions of voters that foreign enemies were the biggest threat to their security and that he’d crush them by “rebuilding” America’s military machine. Worried about ISIS? Don’t be. Trump would “bomb the shit out of them.” Concerned about the nuclear arms race? Not to worry. “We’ll outmatch them at every pass and outlast them all.”Yet few if any Americans lie awake at night fearing invasion by another country or the outbreak of nuclear war. Fifteen years after 9/11, terrorism still ranks high on the American list of concerns (especially, the polls tell us, among Republicans). But that danger is not nearly as dire as Trump and the U.S. national security state insist it is. A litany of statistics shows that deaths from car crashes leave death-by-terrorist in the dust, while since 2002 even bee, hornet, and wasp stings have killed more Americans annually in the United States than “Islamic terrorists.”Since 9/11, only 95 Americans -- 95 too many, let it be said -- have been killed in terrorist attacks in the U.S. Not one of the perpetrators was a tourist or someone on another type of temporary visa, and several were non-Muslims. Nor were any of them refugees, or connected to any of the countries in Trump's two Muslim bans. Indeed, as the journalist Nick Gillespie notes, since the adoption of the 1980 Refugee Act no refugee has been involved in a terrorist attack that killed Americans.Still, Trump’s hyperbole has persuaded many in this country that terrorism poses a major, imminent threat to them and that measures like a 90-day ban on travel to the United States by the citizens of certain Muslim countries will protect them. (A recent poll shows that 54% of the public supports this policy.) As for terrorist plots, successful or not, by white far-right extremists, the president simply hasn’t felt the urge to say much about them.In other words, President Trump, like candidate Trump, embraces the standard take on national security. He, too, is focused on war and terrorism. Here, on the other hand, are some threats -- a suggestive, not inclusive, list -- that genuinely make, or threaten to make, millions of Americans insecure and vulnerable.Poverty: According to the U.S. Census Bureau, in 2015, 43 million Americans, 13.5% of the population, lived below the poverty line ($11,700 for an individual and $20,090 for a three-person household) -- an increase of 1% since 2007, the year before the Great Recession. For children under 18, the 2015 poverty rate was 19.7%. While that was an improvement on the 21.1% of 2014, it still meant that nearly a fifth of American children were poor.The working poor: Yes, you can have a job and still be poor if your wages are low or stagnant or have fallen. The Bureau of Labor Statistics (BLS) uses a conservative definition for these individuals: “People who spent at least 27 weeks in the labor force during the year -- either working or looking for work -- but whose incomes were below the poverty level.” Though some studies use a more expansive definition, even by the BLS’s criteria, there were 9.5 million working poor in 2014.
Wage stagnation and economic inequality: These two conditions explain a large part of the working-but-barely-making-it phenomenon. Let’s start with those stagnant wages. According to the Economic Policy Institute (EPI), for about three decades after World War II, hourly wage increases for workers in non-supervisory roles kept pace with productivity increases: at 91.3% and 96.7%, respectively. Then things changed dramatically. Between 1973 and 2013, productivity increased by 74.4% and wages by only 9.2%. In other words, with wages adjusted for inflation, the average American worker made no more in 2013 than in 1973.
As for economic inequality, the EPI reports that from 1980 to 2013 the income of the top 1% of wage earners increased by 138% compared to 15% for the bottom 90%. For those at the lowest end of the wage scale it was even worse. In those years, their hourly pay actually dropped by 5%.
When was the last time you heard Donald Trump talk about stagnant wages or growing economic inequality, both of which make his most fervent supporters insecure? In reality, the defunding of federal programs that provide energy subsidies, employment assistance, and legal services to people with low incomes will only hurt many Trump voters who are already struggling economically.
Climate change: There is a scientific consensus on this problem, which already contributes to droughts and floods that reduce food production, damages property, and threatens lives, not to speak of increasing the range of forest fires and lengthening the global fire season, as well as helping spread diseases like cholera, malaria, and dengue fever. Trump once infamously described climate change as a Chinese-fabricated “hoax” meant to reduce the competitiveness of American companies. No matter that, in recent years, the Chinese government has taken serious steps to reduce greenhouse gas emissions.
Now, President Trump is gearing up to take the U.S. out of the climate change sweepstakes entirely. For instance, he remains determined to withdraw the country from the 2015 Paris Agreement (signed by 197 countries and so far ratified by 134 of them) aimed at limiting the increase in global temperature to a maximum of two degrees Celsius during this century. Scott Pruitt, his appointee to run the Environmental Protection Agency, denies that climate change is significantly connected to “human activity” and is stocking his agency with climate change deniers of like mind. Needless to say Pruitt didn’t balk at Trump’s decision to cut the EPA’s budget by 31%.
Nor do Trump and his team favor promoting alternative sources of energy or reducing carbon emissions, even though the United States is second only to China in total emissions and among the globe’s largest emitters on a per-capita basis. Trump seems poised to scale back President Obama’s plan to increase the Corporate Annual Fuel Efficiency Standard -- created by the government to reduce average automobile gas consumption -- from the present 35.5 miles per gallon to 54.5 miles per gallon by 2025, end the 2015 freeze on leases for coal mining on federal land, and ease power plant emission limits. Worse yet, Trump’s America First Energy Plan calls for producing more oil and gas but contains nary a word about climate change or a green energy strategy. If you want a failsafe formula for future environment-related insecurity, this, of course, is it.
Bogus Remedies
Candidate Trump certainly did tap into a deepening sense of insecurity about wage stagnation, the disappearance of good working-class jobs, and increasing economic inequality. But in the classic national security mode, he has artfully framed these problems, too, as examples of the economic hardship that foreign countries have inflicted on America. And the four remedies he offers, all rooted in a nationalistic economic outlook, won’t actually help American workers, could hurt them, or are at best cosmetic.
First, he favors renegotiating multilateral trade deals like NAFTA and wasted no time withdrawing the United States from the Trans-Pacific Partnership, accords which he believes hurt American workers. Second, he wants to impose tariffs of 35% to 45% on imports from countries such as Mexico and China that he accuses of unfair trade practices. Third, at least on the campaign trail he pledged to punish countries like China, Japan, and Germany for supposedly devaluing their currencies in order to boost their exports unfairly at America’s expense. Fourth, he’s high on slapping a border tax on companies that import from their branches or subcontractors abroad the components needed to make products to be sold in the United States, as well as on firms that simply import finished products and sell them locally.
Some of these punitive moves, if actually pursued, will only provoke retaliation from other countries, harming American exporters and consequently the workers they employ. Tariffs will, of course, also increase the cost of imported goods, hurting consumers with low incomes the most, just as taxing U.S. corporations for importing from their subsidiaries abroad will increase the prices of locally made goods, possibly reducing demand and so jobs.
Even the nullification of trade pacts, whatever positives might be involved, won’t bring industries like steel, textiles, and basic machine-making that once provided good jobs for the working class back to the United States. Trump blames China for the decline in manufacturing employment, as does one of his top economists, Peter Navarro. (Despite holding a Harvard Ph.D. in economics, Navarro evidently doesn’t grasp that trade deficits don’t have a major effect on employment and that protectionism doesn’t cut trade deficits.)
What’s really required are policies that help displaced manufacturing workers to get decent jobs now, while addressing wage stagnancy, which has been significantly aided and abetted by a sharp decline in union membership in recent decades. According to the Bureau of Labor Statistics, between 1983 and 2015 membership in public-sector unions held reasonably steady. Not so for private-sector union membership, which plunged from 12 million in 1983 to 7.6 million in 2015. As a result, workers have been increasingly incapable of combatting wage stagnation through collective bargaining. Tellingly enough, however, as of 2015, the median weekly paycheck of unionized workers was still 21% larger than that of workers who did not belong to a union.
Consider Trump’s business history when it comes to labor (including the hiring and stiffing of undocumented workers), as well as the make up of his immensely wealthy, Goldman Sachs-ified economic team, and the Republican Party’s attitude toward unions. Then ask yourself: How likely is it that this administration will be well disposed toward unionization or collective bargaining?
And don’t forget automation, a subject Donald Trump has essentially been mum about. It has contributed decisively to job loss and wage stagnancy by reducing or even eliminating the need for labor in certain economic sectors. As economists Michael Hicks and Srikant Devraj have demonstrated, increased productivity through automation has been far more crucial in reducing the need for human labor in U.S. manufacturing than outsourced jobs and imports. Thanks to labor-displacing technologies, U.S. manufacturing output actually increased in value by 17.6% between 2006 and 2013 while the workforce continued to shrink.
Another source of wage stagnancy is rising economic inequality, which stems partly from the fierce corporate focus since the 1980s on boosting quarterly earnings and paying dividends that will keep shareholders happy, even if that requires incurring debt, rather than increasing workers’ wages.
Alternative Policies
Trump claims that he will create more jobs by lowering the corporate tax rate. At 35% -- 38.9% including the average state tax -- the American corporate tax rate is significantly higher than the global average (29.5%). Nonetheless, the familiar high-corporate-taxes-kill-jobs narrative that Trump trumpets is simplistic. More than 60% of American companies are so-called S corporations. They pay no corporate tax: they pass their profits on to stockholders who then report the gains when filing income tax returns. And even the corporations that do pay taxes manage to reduce the burden significantly through such steps as claiming accelerated depreciation on equipment and establishing offshore companies whose books reflect their profits. As a result, their true tax rate isn’t anything like 38.9%. High corporate taxes aren’t what stops companies from creating jobs or paying workers more, which means that changing that rate won’t fix any problems, not for American workers anyway.
There are other solutions to low wages and unemployment, even if President Trump will never favor them.
Investing more in public education, for example. Local property taxes and state monies still count heavily in funding public schools. (Federal support is less than 15%.) So the quality of a school can depend greatly on the zip code in which it’s located, especially because parents in wealthy neighborhoods normally raise more money to help their schools than their non-affluent counterparts can. School quality can also depend on how wealthy your state is.
Though other factors doubtless play a role, in general, the better the quality of the school, the greater the likelihood that a child will go to college and the stronger his or her income and prospects will be. Increasing federal funding to schools that lack adequate resources could improve matters. But if you expect President Trump and Secretary of Education Betsy DeVos to consider such a proposition, think again.
Raising the minimum wage significantly could also help reduce income inequality and the number of working poor. Democrats have favored raising the minimum wage to $10.10, which, it is believed, would reduce the number of people living in poverty by an estimated 4.6 million. That’s hardly an outlandish proposal. Some experts, like former Labor Secretary Robert Reich, have called for a minimum wage of $15 an hour, though they are in the minority. But even certain mainstream economists, like Princeton’s Alan Krueger, support a $12 rate and reject the right-wing claim that it would kill jobs.
Don’t expect the Trump administration (or the GOP) to push for any form of such a policy. Take a look at the members of the president’s Strategic and Policy Forum (SPF), whose duties include providing advice on job creation, and you'll realize that such a relatively modest goal will be off the table for at least the next four years. You’ll find representatives from the Blackstone Group, Walmart, IBM, General Motors, Boeing, and General Electric in the SPF, but not one labor advocate. Case closed.
Prepare for Business as Usual
The net worth of Trump’s cabinet (the president excluded) is $5 billion, and that’s a conservative estimate (no pun intended). By some calculations, it may be $13 billion. According to Politifact’s Tom Kertscher, that “modest” $5 billion figure exceeds the net worth of the bottom one-third of all American families. Now, what likelihood do you think there is that Trump would ever implement policies that threatened to transform the distribution of wealth and power in America to the detriment of the economic class from which he and his cabinet hail? (In that spirit, remember that candidate Trump proposed a tax plan that would focus on the wealthiest Americans by cutting the top tax rate from 39.6% to 25% and eliminating the estate tax, 90% of which is paid by the country’s wealthiest 10%.)
It’s much easier to scapegoat outsiders, whether China, Japan, Mexico, and Germany (whose government Trump trade adviser Navarro has also accused of currency manipulation), or undocumented workers who generally hold jobs in the U.S. that require lower skills, pay less, and that most American citizens avoid. It’s also easier to stick with the standard militarized conception of national security and, for good measure, hype the perils posed by Islam, which for Steve Bannon, Trump’s chief political strategist, and Stephen Miller, his senior adviser on policy, amounts to a synonym for extremism and violence, even if Islamic terrorists pose the most miniscule of threats to most Americans.
Not surprisingly, Trump proposes to increase the country’s already staggering defense spending for next year by another $54 billion. To put that increment in perspective, consider that Russia’s total defense spending in 2015 was $66 billion and Britain’s $56 billion, while the United States already spends more on defense than at least the next seven countries combined. (In fairness to Trump, Senators John McCain and Mac Thornberry, respectively the chairmen of the Senate Armed Services Committee and the House Armed Services Committee, want to bulk up the defense budget even more.)
Trump also seems determined to stay the course on America’s forever wars in Afghanistan and Iraq. Neither he nor his generals show any sign of abandoning the Obama-era strategy of whack-a-mole drone strikes and raids by Special Operations forces against terrorist redoubts around the world (as witness a recent failed special ops raid in Yemen and 24 drone strikes -- half of the maximum number that the United States launched against that country in any preceding year). Trump has already deployed 400 Marines as well as Army Rangers to fight ISIS in Raqqa, Syria, and another thousand troops may soon be heading that way. And General John Nicholson, commander of the US-led military coalition in Afghanistan, has called for “a few thousand” additional troops for that country.
So expect President Trump to dwell obsessively on threats that have a low probability of harming Americans, while offering no effective solutions for the quotidian hardships that actually do make so many citizens feel insecure. Expect, as well, that the more he proves unable to deliver on his economic promises to the working class, the more he’ll harp on the standard threats and engage in saber rattling, hoping that a continual atmosphere of emergency and vulnerability will disarm critics and divert attention from his failures.
In the end, count on one thing: voters who were drawn to Trump because they believed he would rein in interventionism abroad and deal with festering problems at home are in for a disappointment.
