(C) Daily Kos
This story was originally published by Daily Kos and is unaltered.
. . . . . . . . . .
Gaming the Pending Trump Economic Crash [1]
['This Content Is Not Subject To Review Daily Kos Staff Prior To Publication.']
Date: 2025-02-10
Leading today’s good news is the likelihood that the sweeping defiance of courts feared by many including George Conway in this apocalyptic interview with Sarah Longwell link. Conway can find no logical or practical obstacle to Trump simply defying the courts, telling the federal marshal assigned to enforce court rulings to stand down, and effectively removing himself from legal jurisdiction.
There’s no doubt this is where the orange guy wants to go, and the practical political constraints might allow it, but the economics don’t pencil out.
The plutocrats cannot have a market crash, let alone a full-scale economic failure. Trump ignoring the courts would create the crisis of confidence in government integrity that will not go back in the bottle. They recognize the delicate nature of financial markets and the huge private debt overhang. The sudden abandonment of 25% tariffs on Canada and Mexico indicate somebody has veto power over complete excess.
Good news repeated. The Trump tariff war against our two closest trading partners might seem like a good idea to Vladimir Putin, and he may have passed the suggestion along to Elon or Donald in one of their regular phone conversations, but the tariffs did not happen. Today’s announcement of a 25% tariff tax on imported steel and aluminum is face-saving for Trump, but bad for international relations and the American economy. The major target is Canada, and we should expect to see retaliation and perhaps another cancellation in exchange for actions already taken under Biden.
Good news, too, that mass deportation is still a talking point, a threat, but on the ground no real progress has been made in evicting hundreds of thousands or millions of productive workers. The impact of a successful deportation might not be immediate, as it is not harvest season, but it would be certain and dramatic — on farmers, farm country, and on prices at the grocery store. (See “Bad News” below on why the threat of deportation may have similar effects.)
More good news — Elon Musk has hacked into Article I of the Constitution, but popular outrage across the country has prevented his taking complete control of government payroll and payment accounts … so far. (Musk is attacking judges, however, in a manner indicating he knows he has committed crimes and has no legitimate defense.
Bad News
The bad news begins with the flagrant incompetence and corruption that proceeds apace. This is the basic condition that will produce the crash. Trump has no clue and he is in charge. He has surrounded himself with people who also have no clue. His cabinet is a murderers row of nut cases and Putin pals, with no conception of public service or public good. They are sharks in an ocean who do not respect the water. They are tearing down the institutions that make government work. The tariff episode reveals the win-win of trade relationships is a concept beyond Trump’s brain to access. That his attempt to dominate inevitably ends in lose-lose, not a beneficial transaction.
Bad news again, because tariffs, deportation, austerity, shutting programs like USAID, cutting the government’s work force, etc., are the exact processes that shrink the economic and put pressure on the enormous private debt. It looks like saving money for himself to Trump, but it is actually just shrinking the economy. Biden had the US humming, the envy of the world. Every anti-Biden move is an anti-economy move. Biden knew what he was doing. Trump does not.
It is bad news when inflation spikes, not just because it drains effective demand, but because it also stimulates the myopic Fed to raise rates and reinforce recessionary pressures. Whenever prices go up, for whatever reason, he Fed raises interest rates. If the economy is expanding rapidly and demand bids up prices, the Fed raises rates. If the economy stalls, supply is restricted (such as by labor conditions in farming) or tariffs are raised, whatever sends prices up, the Fed raises rates. The interest rate fetish ahs never worked very well and often deepens a crisis, but Jerome Powell and the Fed governors occupy an independent fourth branch of government that is literally and practically owned by the commercial banks. It is Big Money the Fed works for, not the president or Congress or — heaven forbid — the people. Big Money does not care what is good for Trump, and is likely under the illusion that Trump works for them as well.
The bad news keeps coming with incompetence and corruption. These are bad for consumer confidence, business confidence and the confidence of our allies. While “confidence” may seem like a squishy or fuzzy concept, the national and global financial architecture and even the value of the money are founded on trust. When the economy begins to wobble, as it will, trust is the only stabilizer. Absent trust, a bobble can become seismic very quickly.
More bad news, as it is becoming obvious that Trump, Musk, Kash Patel, Tulsi Gabbard and others talk a lot more o Russia and Putin than they do to any other foreign country or leader. We should assume that national security has already been grossly compromised. Trump’s actions against the ICC, his attempts to dismantle the CIA, FBI, USAID, etc., are in no American’s best interest. Throw in the antagonism to Ukraine and the breaches of security at Treasury and Defense, and betrayal is 95% proven.
Irrespective of the obvious chaos and destruction of American interests, the oligarchs in Big Oil, Big Tech and Big Money somehow believe they are in control. Peter Theil, for example, successfully promoted Vance to VP and is racing ahead on the overt fascism track.
Restoring American democracy and citizen control of government will require he elimination of the plutocracy, which is a problem, since the rich and super-rich are enormously powerfully and endlessly craven.
Bottom line, the Trump Incompetence and Corruption Crash (TICC) is well ahead of schedule. Absent significant moderation in the cascades of inanity and insanity, the crisis will likely be in full flower by mid-summer. Should some sobriety return to Capitol Hill, another nine or twelve months might be possible before the collapse. There is no scenario short of fantasy that allows us to escape.
Which allows us to end on good news: Trump does not survive his own incompetence and grotesquely complete corruption. There will be an opportunity to rebuild from the ashes, and it may be the best hope our democracy has.
[END]
---
[1] Url:
https://www.dailykos.com/stories/2025/2/10/2302913/-Gaming-the-Pending-Trump-Economic-Crash?pm_campaign=front_page&pm_source=latest_community&pm_medium=web
Published and (C) by Daily Kos
Content appears here under this condition or license: Site content may be used for any purpose without permission unless otherwise specified.
via Magical.Fish Gopher News Feeds:
gopher://magical.fish/1/feeds/news/dailykos/
