Last night the Washington Post published an article by Catherine Rampell that exposed President Donald Trump’s corrupt and immoral strategy when it came to predicting America’s economic progress. The administration has been massaging the country’s economic statistics to mask the fact that they haven’t got an economic plan to overhaul the country’s finances, which was one of Trump’s campaign promises.
Usually, the president-elect’s transition team puts together a new budget with the help of the Council of Economic Advisers (CEA), who estimate a baseline of economic growth based on current policies. The estimate usually goes up after that, as every new administration will be working on the assumption their policies will create economic growth.
But not with Trump.
The Trump transition team instead ordered CEA staffers to predict sustained economic growth of 3 to 3.5 percent. The staffers were then directed to backfill all the other numbers in their models to produce these growth rates.
Not only is this intellectually unethical, it is also pretty stupid, as Rampell explains:
Inflation-adjusted economic growth over the past decade has been under 2 percent. And independent projections for the coming decade are equally lackluster, thanks in part to population aging. The Federal Reserve, the nonpartisan Congressional budget Office and private forcasters predict about 1.8 to 1.9 percent annual growth.
That is significantly less than 3.5! Trump’s team is essentially setting him up for inevitable failure with this move. Assuming that the economy will do well “based on nothing but expediency” while still not providing any concrete plans for how exactly such rapid growth will occur is a recipe for a PR disaster. This is probably because they haven’t got any plans, and are trying to buy as much time as possible while they get their act together. How long that will take is another matter.
Even conservatives are finding Trump’s statistics laughable:
On an American Economic Association panel lat month, Colubia Business School dean Glenn Hubbard [who worked for the George W. Bush Administration] discussed the consequences of Trump’s agenda. He estimated that “reasonable or upper-bound estimates” for sustained economic growth would be about 2.75 percent. And to be clea, many economists find even that prediction Pollyannaish.
Trump is well known for his dislike of experts and national statistics that don’t fit with his narrow worldview where everything os rosy and the world loves him. He has in the past called the national unemployment statistics “phony”, citing far larger percentages with no sources to back up his claims.
Trump has also shown disdain for well-respected financial institutions like the CEA, probably because their publications are grounded in observable facts, not pro-Trump fiction. Trump has demoted the CEA chair from his cabinet and neglected to replace him, probably because, as Rampell points out: “no one respectable is willing to take the job.”
The Trump administration’s dishonesty is palpable. In order to mask the administration’s incompetence, they are massaging the figures, cooking the books and making honest academics do their dirty work. If Trump actually had a plan then it would have been announced by now. Instead, they are stalling. But there could be a silver lining in this story. By setting the predicted growth rates so high, Trump’s supporters will have a real shock to their system when the real figures come out and they realize, finally, that they’ve been lied to.
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