Toward a unified field theory of Trumplandia
TOWARD A UNIFIED FIELD THEORY OF TRUMPLANDIA — It’s easy to view the set of trade and immigration policies as separate threads in Trump world. But they really aren’t. Trump and some of his advisers (Peter Navarro on trade, Stephen Miller on immigration) view their principal goals as rewinding the country back to one that is a dominant manufacturing power with entirely re-shored supply chains and a demographic makeup that resembles an earlier era.
And they are willing to create significant disruption and pain (trade wars and harsh immigration policies) to get there. The larger questions are whether their policy goals are at all desirable or attainable and the amount of disruption and pain the nation is willing to endure. We won’t know on trade for quite some time. We just found one line the nation wasn’t willing to cross on immigration, though Trump seems primed to test that line again and potentially push it further.
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The president has successfully taken over the GOP and bent the party toward his policies. He has an enormously strong bond with his base. And many conservatives who don’t love Trump dislike the left and their attacks on the president even more, especially when it includes kicking his aides out of restaurants and threats of worse.
The Mueller probe could theoretically upend everything in Trump-world. But if it doesn’t, much will depend on whether Trump’s actions on trade and immigration create enough anger and economic dislocation to drive Democrats back into some level of power in the midterms and potentially back into the White House in 2020.
SPEAKING OF TRADE ACTIONS… The White House is expected to announce by the end of this week a new set of restrictions on Chinese investment in the U.S. and on technologies that can be sold to China, per POLITICO’s Doug Palmer and Adam Behsudi:
“After an internal debate, the administration appears to have settled on more aggressive restrictions favored by U.S. Trade Representative Robert Lighthizer and … Navarro over a more conservative approach favored by Treasury Secretary Steven Mnuchin, two private-sector sources privy to the deliberations said.
“Like the tariffs that Trump imposed on $50 billion in Chinese imports — and those he has threatened to impose on $400 billion more if Beijing retaliates — the new investment restrictions and export controls are intended to pressure China to stop unfair trade practices that threaten the United States’ technological leadership. …
“But the administration is already getting pushback from bureaucrats who think it would be a misuse of the export control system, and from businesses that fear the approach will further disadvantage U.S. firms trying to enter the Chinese market.”
AND ABOUT THE TAX CUTS… They appear to be getting less not more popular, per a Monmouth University survey: “The poll also finds that 34% of the public approve of the tax reform plan passed by Congress last December and 41% disapprove. Another 24% are not sure how they feel. These results have shifted in the past six weeks.
“Approval is down 6 points from 40% in late April and disapproval is down 3 points from 44%. The number who give no opinion on the plan has risen 8 points from 16%. Polls earlier this year had shown a more evenly divided public – 41% approve to 42% disapprove in March and 44% approve to 44% disapprove in January – with a smaller percentage of undecided opinion.”
AND SPEAKING OF IMMIGRATION … NYT’s Julie Hirschfeld Davis and Somini Sengupta: “Trump administration officials, under pressure from the White House to provide a rationale for reducing the number of refugees allowed into the United States next year, rejected a study by the Department of Health and Human Services that found that refugees brought in $63 billion more in government revenues over the past decade than they cost.
“The draft report, which was obtained by The New York Times, contradicts a central argument made by advocates of deep cuts in refugee totals as President Trump faces an Oct. 1 deadline to decide on an allowable number. The issue has sparked intense debate within his administration as opponents of the program, led by Mr. Trump’s chief policy adviser, Stephen Miller, assert that continuing to welcome refugees is too costly and raises concerns about terrorism.” Read more.
AND SPEAKING OF NAVARRO… Axios’ Jonathan Swan dug up quite the nugget from one the trade adviser’s older books, written in 1984, during the height of free-trading Reaganism: “The clear danger of this trend [protectionism] is an all-out global trade war; for when one country excludes others from its markets, the other countries inevitably retaliate with their own trade barriers.
“And as history has painfully taught, once protectionist wars begin, the likely result is a deadly and well-nigh unstoppable downward spiral by the entire world economy.”
Navarro penned a lengthy explanation here for his conversion to protectionism.”
BARCLAYS HIRES SENIOR FED OFFICIAL — Per POLITICO’s Zachary Warmbrodt: Barclays has recruited a veteran of the Federal Reserve to join its growing Washington office. Anna Harrington, who worked for the last 10 years at the Fed, is joining Barclays as its U.S. head of bank regulatory policy — a new position. Her most recent post at the Fed was senior supervisory financial analyst.
Harrington is the latest big addition to the U.K.-based bank’s operations in the capital, following the hire of top JPMorgan Chase lobbyist Brendan Reilly to lead its Washington office.
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THIS MORNING ON POLITICO PRO FINANCIAL SERVICES — Colin Wilhelm on the ethics group pushing the DOJ to investigate Commerce Secretary Wilbur Ross over stock trades he made last year. To get Morning Money every day before 6 a.m., please contact Pro Services at (703) 341-4600 or [email protected]
DRIVING THE WEEK — Trump on Monday meets with King Abdullah II bin Al-Hussein of Jordan and campaigns in the evening with South Carolina Governor Henry McMaster who is trying to survive a GOP primary challenge … Trump is expected to celebrate the six month anniversary of the tax cut bill on Friday … House this week will continue to take immigration votes while both chambers battle over a defense authorization bill, the Senate version of which would block Trump’s moves to relax sanctions against Chinese telecom giant ZTE …
Senate Banking has a hearing on Tuesday at 10:00 a.m. on proposals to increase access to capital … House Financial Services subcommittee has a hearing at 2:00 p.m. Tuesday on de-risking and on Wednesday at 10:00 a.m. on HUD … SEC holds on open meeting on Tuesday
House Small Business Committee has a hearing on Wednesday at 11:00 a.m. on ZTE … Senate Banking has a hearing at 10:00 a.m. Thursday on corporate governance.