President Donald Trump has promised his presidency would be the start of a "golden age" where prices go down, world peace will be achieved, and no one has to worry about America being taken advantage of economically. Instead, barely two months into his presidency, everything is threatening to collapse, wrote Stephen Collinson in an analysis for CNN published Tuesday.
This is exemplified by massive stock market plunges that have wiped out most people's retirement savings gains since the election, and Trump himself repeatedly refusing to rule out a recession taking hold this year.
"Trump is trying to shatter everything that everyone thought they knew about US foreign aid, trade and economic policy. He’s set off trade wars with US neighbors, indiscriminately fired thousands of government workers, and switched to punishing the victim in Ukraine — fracturing an 80-year bond of trust with allies," wrote Collinson. "And, as he told the nation a week ago, 'We’re just getting started.' So it wouldn’t be surprising if there’s a price to be paid."
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Recessions are famously hard to predict, Collinson noted, and sometimes even when economists believe one is likely, it never materializes. Aside from the COVID-19 pandemic, the economy has largely been stable since the financial crash of 2008, and even the economic damage from the pandemic bounced back fairly quickly. Nonetheless, "Trump, by trying to change so much, is still playing with fire. His administration so far is showing great skill in tearing things down, but less facility in explaining how his chaos will translate to swift prosperity" — particularly when it comes to his massive tariffs on Canada and Mexico that have even members of his own party spooked.
Trump advisers, for their part, insist the current uncertainty and pain is temporary, with White Houthere is se economic strageist Kevin Hassett saying, “I think that what’s going to happen is the first quarter is going to squeak into the positive category, and then the second quarter is going to take off as everybody sees the reality of the tax cuts."
Nonetheless, Collinson wrote, Trump's massive moves to rewrite the economy and international order have put America and the world into uncharted territory.
After all, he added "rosy assessments" like Hassett's "seem rather familiar and risk falling into a dangerous political trap that snared the Biden administration – that of telling voters the economy is in better shape than they perceive it to be. Repeated claims by top Biden aides that the worst inflation since the 1980s early in his term was merely 'transitory' eroded public trust in his presidency and played a significant role in paving the way for Trump’s return to the Oval Office."
