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What is predictable, however, is that the increasing inequalities in American life that lie at the heart of the populist Trump rebellion are only going to be exacerbated by Trump. This is not just do do with the usual reasons why a Republican administration allows inequalities to increase: it is more dramatic than that. Just look at the speed with which Trump happily cancelled his campaign promises to protect Medicaid, boost spending for opioid abuse treatment and ensure that everyone has health insurance cover. After less than a month in office he announced “100 per cent support” for a health bill providing for sweeping cuts in Medicaid and for health coverage being reduced by 24 million people over the next decade. These cuts would have enabled tax reductions of $165,090 a year for families earning $3.75 million a year, but no tax cut at all for those earning $208,500 a year or less. In other words, Trump was happily backing a huge transfer of wealth away from those deprived of coverage (the poor) towards the wealthiest 0.1 per cent.

The stock market boom has been predicated on the assumption that Trump will turn out much like Reagan, who came to power saying he wanted to cut the debt and balance the budget, but also promising tax cuts and increases in defence spending. In practice, this meant that under him the debt could only grow. The director of the Office of Management and the Budget, David Stockman, had the difficult job of drawing up a balanced budget every year. To do this he was asked to make absurdly high assumptions about economic growth and thus the level of tax receipts in each upcoming year. Stockman knew this was pure fantasy but had no option but to comply. His conclusion was that “in Washington at budget time you realise afresh every year that the most popular girl in town is Rosie Scenario”. The overall result was a huge Keynesian boom. Reagan increased the national debt by 186 per cent in eight years but nobody really minded because the result was a long economic boom, a soaring stock market and a general feelgood factor.

The assumption is that under Trump it will be much the same: sweeping tax cuts, hugely higher expenditure on defence, homeland security and veterans, tax cuts for the rich, and a huge public works programme for the decaying infrastructure. Ryan feels the same need to present balanced budgets but the market is already betting on a debt-led boom. There is, though, a major problem with that. Under George W. Bush the debt increased by 101 per cent in eight years. Under Obama the debt rose by another 68 per cent in his eight years. But the key difference is that thanks to the magical workings of compound interest, whereas Reagan inherited a debt of $998 billion, Trump inherits a debt of $19.574 trillion. That figure is enough, quite reasonably, to scare not only Paul Ryan but many others and it sharply limits the possibilities of another debt-led boom. If these realities puncture the Wall Street boom there will be anger and burnt fingers in many quarters.

It is difficult to see how America’s current trajectory can end well. The generation-long process of political polarisation has been deeply damaging but it seems only likely to continue. It has become almost a conventional truism to say that the US political system is “broken”. Indeed it is. Trump himself is a sign of that. America has always had a good supply of crude, ignorant rednecks but they seldom got higher than governor (George Wallace, Lester Maddox, Orval Faubus). Now we have one as president. Whatever isn’t already broken, he will surely break.  But there seems no appetite for another constitutional convention to sort things out. The only alternative is continued polarisation until that produces a crisis that nobody can ignore.
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