Economists Offer Bleak View of Trump’s First Term

Economic News: On Monday, the Republican National Convention will kick off, giving party leaders a chance to discuss President Trump’s victories in his first term.

Several economists took a dim view of his policies; however, they cited his ability to break the U.S.’s “obsession” with budget deficits as being one of Trump’s positive accomplishments.

However, Mark Zandi Moody’s Chief Economist and Nobel laureate Joseph Stiglitz expressed their concerns over President Trump’s moves towards deglobalization.

According to Zandi, the U.S. economy will ‘diminish’ after the coronavirus pandemic. He anticipates policymakers to have trouble trying to ‘reengage with the rest of the world.’

Stiglitz criticized Trump’s protectionism and termed it as ‘ugly’. He cited the ban on medical supply exports and hoped other countries would not reciprocate.

According to the former chief economist at Goldman Sachs, Jim O’Neill, there’s a difference between Trump’s rhetoric and what will happen when it comes to reducing the trade deficit with China and bringing jobs back to the U.S.

Jim O’Neill warned that, without a ‘defined policy’ in the U.S. to deliberately rein in deficit spending, the U.S. would be unable to erase its trade deficit with China. The deficit was more than $130 billion as of July 2020.

Jim added that, though Trump’s promise to bring back jobs in 2016 was powerful, he doesn’t see the possibility without specific policy intervention.

Jim also noted that robots would likely do the factory work that the U.S. could bring back. Therefore, it won’t create more jobs for Americans, as Trump hopes.

Jim thinks Trump’s ‘protectionism’ is a way to make U.S. manufacturing more resilient, but it could backfire.

How long would the Fed keep its rates at zero?

Differing perspectives

Another economist, Jeffrey Sachs offered, the bleakest view of Trump’s tenure. He is a former director of The Earth Institute at Colombia University. Jeffrey thinks Trump is the worst president in American history aside from perhaps James Buchanan’s lead into Civil War.

He also warned that Trump’s rhetoric regarding China was dangerous and said the U.S. should prepare for a ‘multipolar world.’

Jeffrey, however, praised Scandinavian countries for their social safety nets. He suggested the U.S. should move toward a similar approach.

Nobel laureate Paul Krugman said the U.S. could pay for these kinds of safety nets now.

Although the New York Times columnist has been known to criticize Trump, he credited him with breaking the U.S.’s ‘obsession’ with budget deficits.

He predicted that Joe Biden’s presidency would not face similar calls for fiscal austerity that would have occurred if Hillary Clinton had won in 2016.

Jude Deere said Trump’s policies of deregulation, lower taxes, fair and reciprocal trade, and energy independence created the strongest and most inclusive economy ( with rising wages ) in the U.S.’s history under his leadership.

Jude Deere is the deputy press secretary at the White House.

On Thursday, Trump will formally accept his party’s nomination for a second term.

Currently, he trails Joe Biden, his rival Democratic nominee, in most national and battleground polls.