.
The relatively older voters who sent Donald Trump to electoral victory spent their formative years in the economically dominant America of the 20th Century. They also grew up in a global economy dominated by large industrial manufacturers who provided unprecedented prosperity to the blue-collar workers they employed.
Today, the world looks very different from these voters’ vantage points. The economic liberalizations of China and India have helped lift nearly a billion people out of poverty in the last quarter-century alone. But the very success of these emerging markets has left many in America feeling like their relative standing has declined.
Technology and globalization have also shifted manufacturing jobs away from high-cost, high-regulation, high-unionization economies like America’s, moving them to emerging markets or to automation. America’s transition from a manufacturing powerhouse to one driven by the technology and service industries has rewarded the nation’s educated class, but has left behind those without a college degree.
President Trump is viewed by his skeptics at home and abroad as an ignorant madman, without any real knowledge of how economics or foreign affairs work. But while Trump’s personality is unusual, his political philosophy draws from well-established traditions in America and Europe.
Most importantly, his diagnosis of America’s economic ills is two parts right and one part wrong. He’s right that America’s tax code for businesses—among the steepest in the industrialized world—is a big part of why manufacturers are leaving America for other countries. And over the past 25 years, America has endured an explosion of federal regulations that have increased both the cost and the complexity of building businesses in the United States. Trump’s resolve to make dramatic changes in both areas could do much to improve America’s industrial output and help the blue-collar workers he speaks so often about.
Where Trump is less likely to succeed is in tearing up global trade agreements and shielding American businesses from foreign competition. A trade war will harm exporting U.S. manufacturers as much as it will help those manufacturers with rivals abroad. Having said that, there is merit to the charge that China has been violating its World Trade Organization obligations with regard to intellectual property and trade secrets, and Trump’s forthright challenge of China’s malfeasance is long overdue.
On fiscal policy, Trump seeks to combine traditional Republican priorities—tax cuts and repeal of President Obama’s health-reform law—with traditional Democratic ones; namely, a trillion-dollar infrastructure package and a replacement for “Obamacare” that will achieve near-universal health insurance coverage.
The high cost of America’s health care system is one of its greatest barriers to economic mobility and fiscal stability. American health care as a false reputation as a place of unfettered capitalism where the indigent die on the street. In fact, U.S. per-capita public spending on health care is only exceeded by that of Norway and Luxembourg. America spends more than enough to achieve universal coverage; the problem is that its subsidies are skewed to the very poor, the middle class, and the wealthy, leaving tens of millions in the working poor uninsured.
President Obama aimed to solve this problem by increasing public spending on health insurance, without tackling the fundamental drivers of costly U.S. care. That approach has not worked as well as had been hoped, as tens of millions of Americans remain priced out of the plans that the new health law has sponsored.
Donald Trump has departed from traditional Republican rhetoric in asserting that, when it comes to health care, “everybody’s got to be covered” and “the government” is going to pay for it. He is in a unique position to forge a bipartisan solution that achieves the long-held goal of Democrats but in a way more in keeping with the Republican aspiration of fiscal restraint. If he succeeds, he will have been the most consequential U.S. president in a generation.
About the author: Avik Roy, a healthcare and GOP policy and politics expert at Dūcō, is the Opinion Editor at Forbes, and founder of The Foundation for Research on Equal Opportunity, non-profit think tank focused on expanding economic opportunity to those with below-median incomes. He has advised three presidential candidates, including Marco Rubio and Mitt Romney.
The views presented in this article are the author’s own and do not necessarily represent the views of any other organization.
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Trump’s Consequential Economic Agenda
Global Economy Abstract Background. World Economy Mechanism Conceptual Background Illustration with Trading Stats Compass Rose and Some Mechanisms.
January 26, 2017
The relatively older voters who sent Donald Trump to electoral victory spent their formative years in the economically dominant America of the 20th Century. They also grew up in a global economy dominated by large industrial manufacturers who provided unprecedented prosperity to the blue-collar workers they employed.
Today, the world looks very different from these voters’ vantage points. The economic liberalizations of China and India have helped lift nearly a billion people out of poverty in the last quarter-century alone. But the very success of these emerging markets has left many in America feeling like their relative standing has declined.
Technology and globalization have also shifted manufacturing jobs away from high-cost, high-regulation, high-unionization economies like America’s, moving them to emerging markets or to automation. America’s transition from a manufacturing powerhouse to one driven by the technology and service industries has rewarded the nation’s educated class, but has left behind those without a college degree.
President Trump is viewed by his skeptics at home and abroad as an ignorant madman, without any real knowledge of how economics or foreign affairs work. But while Trump’s personality is unusual, his political philosophy draws from well-established traditions in America and Europe.
Most importantly, his diagnosis of America’s economic ills is two parts right and one part wrong. He’s right that America’s tax code for businesses—among the steepest in the industrialized world—is a big part of why manufacturers are leaving America for other countries. And over the past 25 years, America has endured an explosion of federal regulations that have increased both the cost and the complexity of building businesses in the United States. Trump’s resolve to make dramatic changes in both areas could do much to improve America’s industrial output and help the blue-collar workers he speaks so often about.
Where Trump is less likely to succeed is in tearing up global trade agreements and shielding American businesses from foreign competition. A trade war will harm exporting U.S. manufacturers as much as it will help those manufacturers with rivals abroad. Having said that, there is merit to the charge that China has been violating its World Trade Organization obligations with regard to intellectual property and trade secrets, and Trump’s forthright challenge of China’s malfeasance is long overdue.
On fiscal policy, Trump seeks to combine traditional Republican priorities—tax cuts and repeal of President Obama’s health-reform law—with traditional Democratic ones; namely, a trillion-dollar infrastructure package and a replacement for “Obamacare” that will achieve near-universal health insurance coverage.
The high cost of America’s health care system is one of its greatest barriers to economic mobility and fiscal stability. American health care as a false reputation as a place of unfettered capitalism where the indigent die on the street. In fact, U.S. per-capita public spending on health care is only exceeded by that of Norway and Luxembourg. America spends more than enough to achieve universal coverage; the problem is that its subsidies are skewed to the very poor, the middle class, and the wealthy, leaving tens of millions in the working poor uninsured.
President Obama aimed to solve this problem by increasing public spending on health insurance, without tackling the fundamental drivers of costly U.S. care. That approach has not worked as well as had been hoped, as tens of millions of Americans remain priced out of the plans that the new health law has sponsored.
Donald Trump has departed from traditional Republican rhetoric in asserting that, when it comes to health care, “everybody’s got to be covered” and “the government” is going to pay for it. He is in a unique position to forge a bipartisan solution that achieves the long-held goal of Democrats but in a way more in keeping with the Republican aspiration of fiscal restraint. If he succeeds, he will have been the most consequential U.S. president in a generation.
About the author: Avik Roy, a healthcare and GOP policy and politics expert at Dūcō, is the Opinion Editor at Forbes, and founder of The Foundation for Research on Equal Opportunity, non-profit think tank focused on expanding economic opportunity to those with below-median incomes. He has advised three presidential candidates, including Marco Rubio and Mitt Romney.
The views presented in this article are the author’s own and do not necessarily represent the views of any other organization.
