To the editor:
Understanding President Trump’s economy requires an inspection of its three major driving forces.
First, the tax bill. The $2 trillion tax cut, mostly for corporations, came without any requirements on how this windfall would be used. Instead of investments in corporate infrastructure to create new jobs, most of the money went into stock buybacks and dividends for investors, boosting stocks and CEO compensation.
The top half of the electorate with 401(k) accounts is benefitting, while the bottom half is left behind. Second, deregulation. While the Republicans applaud and praise Trump for deregulation of corporations and removal of red tape, it is instructive to look at exactly what is being deregulated.
Clean air and water standards are being weakened; food inspection is being handed over to the companies producing the food. Oil companies are being allowed to drill in previously environmentally protected areas.
These changes also positively affect stock valuations but come at the expense of increased respiratory ailments among children and seniors, as well as higher cancer rates from tainted water supplies.
Third, manipulation of the Federal Reserve system. The Federal Reserve’s mission is twofold — control inflation, optimize employment while at the same time maintaining a healthy economy. It does so through controlling key interest rates.
The Fed is supposed to be independent of political pressure. Trump is the first president to publicly insult its chairman.
Chairman Jerome Powell has been subjected to withering attacks from Trump in an effort to lower rates and produce an overheated economy.
These rates are a tool used by the Federal Reserve to protect the economy; Trump is trying to take over the independent operation of the Fed to his advantage.
The next time you look with satisfaction at your 401(k), remember it comes at a cost to your children’s future. Specifically problematic are access to healthcare, their ability to pay back student loans, affordable childcare and a clean environment. Lastly, remember that Trump took over a healthy economy from President Barack Obama, who took over an economy that was losing 800,000 jobs per month, with three automobile companies close to bankruptcy and amid a total freeze-up of financial institutions.