He's Good and Bad on Foreign Affairs, Good and Bad on the Economy

I approach this task with more trepidation than I usually have when I write. I am not used to evaluating a presidency. Still less am I used to evaluating the reflections of a thoughtful political scientist who, I suspect, does more of this kind of evaluation than I do. And, finally, I am used to writing articles in which I’m strongly on one side or the other. In this case, however, I see a lot of good and a lot of bad in President Donald John Trump.

The good is on Trump’s economic and foreign policy; so is the bad. The bad is also on Trump’s style—the endless tweeting, for example—but so is the good. I say upfront that my evaluation of both Professor Weiner’s Liberty Forum essay and of President Trump is that of a libertarian who is more pro-immigration (legal and illegal) and more non-interventionist on foreign policy than most libertarians.

The first thing to put aside is a perspective that is so widespread in the media and elsewhere that it now has been given a label: Trump Derangement Syndrome (TDS). If one has TDS, one does not judge the President’s policies the dispassionate way one might have judged those of President Obama or President George W. Bush. Instead, one evaluates them in the harshest, most unforgiving way. And that’s if one even bothers to evaluate his policies. Those with the most extreme case of TDS say they are doing so but only point to what a disgusting human being they think he is.

My evaluation comes under three categories: 1) economic policy, 2) foreign policy, and 3) personal style and behavior. Along the way, I will agree with Greg Weiner on certain points and disagree on others.

On the economy, Trump’s biggest triumphs for liberty are in the area of regulation and taxes. On regulation, Wayne Crews of the Competitive Enterprise Institute finds that in Trump’s first nine months, he issued 58 percent fewer “significant rules” than Obama had issued in the corresponding nine-month period of 2016. A significant rule is defined as one that has an impact of $100 million or more. To really understand the significance of those regulatory changes one must, of course, examine the details of each. But one example of a regulatory change in process will give a flavor of some of Trump’s deregulatory moves. In 2015, the Environmental Protection Agency issued a rule asserting the EPA’s jurisdiction over even ponds, swamps, and potholes on farmers’ lands. In response to a lawsuit, the Sixth Circuit Federal Appeals Court stayed the regulation in October 2016, and Trump has reopened the process to modify the rule.

Here’s how Christopher DeMuth, a distinguished fellow with the Hudson Institute and former president of the American Enterprise Institute, has evaluated Trump’s regulatory policies in a recent Wall Street Journal op-ed:

With some exceptions (such as business as usual on ethanol), and putting aside a few heavy-handed tweets (such as raising the idea of revoking broadcast licenses from purveyors of “fake news”), President Trump has proved to be a full-spectrum deregulator. His administration has been punctilious about the institutional prerogatives of Congress and the courts. Today there is a serious prospect of restoring the constitutional status quo ante and reversing what seemed to be an inexorable regulatory expansion.

Professor Weiner, in his brief segment on Trump’s executive actions on regulation, seems to agree with DeMuth.

On taxes, the United States had one of the highest corporate income tax rates in the developed world, and, with the new tax law, that rate has fallen from 35 percent to 21 percent, putting the U.S. rate somewhere in the middle of existing corporate tax rates. Besides letting corporations (which, by the way, are owned by actual people) keep more of their income, the tax cut will attract capital from around the world. With more capital, labor productivity will be higher and, therefore, so will the real wages of U.S. workers.

Moreover, the tax bill moves the United States to a territorial corporate income tax system whereby corporations are taxed in the jurisdiction in which they earned their income. Most countries have such a system; the United States was unusual in taxing U.S. corporations based on their worldwide income.

On the individual income side, the tax law cut marginal tax rates somewhat, making up for much of the revenue loss by restricting to $10,000 the amount of state and local taxes that individuals could itemize on their tax returns. This huge change, combined with an increase in the standard deduction to $24,000 for married couples filing jointly, will cause millions of taxpayers in high-tax states to feel the full bite of their local and state taxes rather than being implicitly subsidized by taxpayers in low-tax states. Why is this good news for the country? Because taxpayers in low-tax states should not be forced to pay for California’s, New York’s, and New Jersey’s high rates of taxation. Moreover, there is one unintended side benefit: there will be more pressure on the high tax states to cut taxes.

Will the tax cut increase the deficit? Unfortunately yes. But we should put that in perspective. According to the Congressional Budget Office, the projected debt in 2027 without the tax cut would have been 91.2 percent of Gross Domestic Product. With the tax cut, it is projected to be 97.5 percent of GDP, an increase of 6.9 percent. That increase is substantial but not huge. And the 97.5 percent estimate assumes that the tax cut will have no positive impact on economic growth.

That’s much of the good news on economic policy. On the other side of the economic ledger are Trump’s proposals to restrict legal immigration further and his moves to renegotiate the North American Free Trade Agreement. One way the former is already showing up is that people here legally on H1B visas are finding those visas harder to renew. And Trump proposes that their spouses, if they are neither U.S. citizens nor permanent residents, will no longer get permission to have paying jobs in the United States. North America will likely have less free trade in a few years than it has had and the United States will likely have fewer new legal immigrants annually than it has had.

Also, in the current dispute with congressional Democrats over the renewal of Deferred Action for Childhood Arrivals (DACA), one of Trump’s non-negotiable items is the proposed E-Verify. Under that proposal, anyone who wants to get a new job would have to wait on government approval and this approval would require an affirmative government finding that the potential employee is legally eligible for work. Does government ever mistakes? It does. Would those mistakes sometimes cause a completely legal worker not to be able to work? They would. Even more important in the long run, as my Hoover colleague, economist John H. Cochrane, has noted, a government with the power to decide who works and who doesn’t would not likely restrain itself in using that power for things other than legal residency.

One issue on which economists are almost unanimous is that free trade is good for both sides because it allows and encourages people in each country to specialize in producing what they are the least-cost producers of. Restrictions on trade, therefore, reduce economic wellbeing. And economists across the political spectrum agree that immigration is good both for immigrants and for those who get to hire or work for immigrants. As economist Michael A. Clemens put it, preventing large numbers of people from migrating leaves “trillion dollar bills on the sidewalk.”

There are more economic issues in play but the above are the high points.

On U.S. foreign and defense policy, there is a widely held view in the foreign affairs establishment that almost anything that happens almost anywhere in the world is so important to the United States that the U.S. government may, by force if necessary, intervene. So, for example, although many Washington wags are shocked that Vladimir Putin may have cared enough about the U.S. election outcome to spend one hundred thousand dollars on Facebook ads, between 1946 and 2000, the U.S. government tried to influence over 80 foreign elections with nary a peep from that establishment. The Bush administration spent $65 million trying to influence the outcome of Ukraine’s 2004 election. And of course, both Democratic and Republican administrations have used force to change governments in other countries, notably, in recent years, Iraq and Libya.

Whereas during the campaign, Trump made some non-interventionist noises, as President he has distinctly muted them while continuing the Bush-Obama policy of intervening violently in other countries’ affairs. He has maintained President Obama’s support for the ruthless Saudi regime’s assault on Yemen, for example. This is potentially as bad, in humanitarian terms, as Obama’s destabilization of Libya. And whereas Trump used to see the invasions of, and occupations of, Iraq and Afghanistan as a huge loss for America, which they were, he has put more troops in Afghanistan. He is also escalating his threats to North Korea. Although nuclear war with North Korea is still highly unlikely, even raising the probability of such a conflict from, say, one in 100,000 to one in 10,000 is dangerous. With any plausible nuclear war, 100,000 people or even a million, almost all of them innocent, would be killed.

One issue on which Trump is better than Hillary Clinton probably would have been is relations with Russia. As a presidential candidate, Hillary Clinton was a Russia hawk. In her speech to the American Legion in the summer of 2016, after referencing an alleged Russian cyberattack on the United States, she stated, “As President, I will make it clear, that the United States will treat cyber attacks just like any other attack. We will be ready with serious political, economic and military responses.” Trump seems less hawkish than Clinton toward Russia, arguably the second or third most powerful country in the world.

Now to Trump’s personal style, the topic to which Professor Weiner directed much of his analysis. Even here, there is not just bad but also good.

The bad is, of course, the endless tweeting. Trump has made it hard for those he deals with to trust him because rather than address differences behind closed doors, he tweets negatively against even his allies such as Senate majority leader Mitch McConnell. Also, I agree with Professor Weiner that Trump’s comments on women’s appearances are disgusting. The man, in short, is a boor.

Professor Weiner notes that Trump’s conservative policies “are being achieved in an utterly unconservative manner.” I agree. Professor Weiner then asks, “Does it matter?” and answers succinctly: “Yes.”

He argues that policies are transient but that “Trump has forever changed the American presidency, and not for the better.” I’m not so sure. I’m not sure, first, that he has forever changed the American presidency and, second, that it is not for the better. Although, as I noted above, some of Trump’s tweets are disgusting and counterproductive, some of his unconservative manner has been refreshing. Probably millions of Americans will never think of Hillary Clinton without the phrase “crooked Hillary” coming to mind. Is it bad to affix the “crooked” label on someone who is, in fact, crooked?

That brings me to what many people, including the “deplorables,” but also including me, like about Donald Trump. He fights back when the media go after him. Republican Presidents tend not to do this.

But let’s grant arguendo that on net, Trump has soiled the presidency. Even here there is an upside. Trump does not do nuance. When he is upset about what someone says about him, he tweets his anger and publicly threatens lawsuits and censorship. The lawsuits have gone nowhere. And if Trump really wanted to follow through on his threatened censorship of television networks, he chose the wrong chairman of the Federal Communications Commission. Ajit Pai  is one of the most deregulatory officials in the Trump administration.

Consider, by contrast, someone who effectively quashed radio criticism of his policies: Franklin D. Roosevelt. In 1934, as University of Alabama historian David Beito has noted, President Roosevelt’s FCC put radio stations on a short leash by reducing the license-renewal period from three years to six months. He appointed Herbert L. Pettey as head of the commission. Pettey had been FDR’s radio adviser during his 1932 presidential campaign. Shortly after this licensing change, NBC announced that it would limit broadcasts “contrary to the policies of the United States government.” CBS went further, announcing an end to broadcasts “in any way” critical of “any policy of the Administration.” Who was more effective—the unsophisticated Trump threatening in public, or the warm and fuzzy (but ruthless and strategic) operator behind the scenes, Roosevelt? The record speaks for itself.

Finally, we need to  put Trump’s personal style in context. One way to do so is to compare him to other politicians who have reached the Oval Office or who have come close. I think of the late Senator Edward M. Kennedy (D-Mass.), who nearly won the Democratic nomination in 1980. I don’t know what his style in the White House would have been. But here’s what I know: he left a woman to suffocate in a car he was driving. His next step was not to get help but to talk to lawyers. And when he made a public statement, he expressed his concern for his family, not hers.

In 1994, I testified before a Senate Committee chaired by Kennedy. I focused on the policy issue at hand, the Clinton administration’s plans for U.S. healthcare, about which he and I disagreed. I ignored his personal failings. What mattered was the policy issue. Maybe you could say that I ate the poisoned fruit and am no longer innocent, and that I should have used my six minutes to denounce this immoral man. But whatever I should have done, the point is that Senator Kennedy set such a low bar for personal behavior that President Trump is probably well above it.