Harris Easily Beats Trump on Economic Policy
His record in the first term is much worse than people remember, and another four years would be worse.
By Alan S. Blinder
Former President Donald Trump speaks about the economy, inflation and manufacturing at a campaign event at Alro Steel in Potterville, Mich., Aug. 29. Photo: Bill Pugliano/Getty ImagesWith the election looking like a coin toss, I continue to marvel at the edge Donald Trump has maintained over Kamala Harris on the economy.
While it’s true that 2017-19 were good years, it’s hard to attribute that success to anything Mr. Trump did as president.
Mostly, the good times from the late Obama period just kept rolling—until the pandemic struck.
But memories are short.
And since past is prologue, let’s try to remember what some of Mr. Trump’s economic policies actually are:
He is again promising to build a wall.
This time it will be a wall of high tariffs that keeps Chinese goods out and makes other imports more expensive.
If you want to know how such a policy is likely to work out, google “Smoot-Hawley.”
Do you remember Mr. Trump’s declaring that “trade wars are good and easy to win”?
Do you remember his labeling Canada a threat to our national security?
Do you remember that China and other nations retaliated against American goods dollar-for-dollar?
Mr. Trump apparently doesn’t.
Rather, he calls “tariffs” a beautiful word and seems to think their revenue-raising potential is boundless.
Has anyone told him that by reducing import volumes, tariffs also reduce the revenue collected?
And if a tariff is truly prohibitive, it collects no revenue at all?
In either case, tariffs push prices in the U.S. up.
That is, they are inflationary.
If you really want to design an inflationary policy, you can augment the tariff wall by creating labor shortages.
We know that Mr. Trump is virulently anti-immigrant and promises mass deportations.
Try to imagine the chaos that rounding up 11 million people would cause, including in labor markets, for which immigrants have been one of the keys to our recent success.
Last but not least on the inflation front, there is the Federal Reserve.
Mr. Trump berated the central bank incessantly while president, even threatening to fire Chairman Jerome Powell, which he couldn’t do.
Early in his term, Mr. Trump took advice from some reasonable people and made some good appointments to the Fed.
Later, not so much.
If there is a second Trump term, it is frightening to think about how he might try to politicize the central bank.
Then there is healthcare.
Mr. Trump wants us to believe that, as president, he saved ObamaCare.
Really?
In fact, he tried to destroy it multiple times.
Only the brave Sen. John McCain, gravely ill, foiled him in 2017.
Try to remember that dramatic scene in the well of the Senate when you appraise Mr. Trump’s “promise” to hold Medicare and Medicaid harmless.
Finally, think about climate change, the one existential threat on the economic side.
It isn’t a Chinese hoax, and you don’t mitigate the impending crisis by ignoring it or by tossing paper towels to hurricane-ravaged Puerto Ricans.
Elections are about choices, and the prospective economic policies of a Harris administration are all starkly different.
Ms. Harris is hardly an apostle of free trade.
But she is far less protectionist, and therefore far less inflationist, than Mr. Trump.
And I’m pretty sure she won’t pretend Canada threatens our national security.
Score a point for Ms. Harris.
On immigration, she supports the “compromise” bill that Mr. Trump had killed in Congress.
The bill wasn’t really a compromise at all.
Rather, it was a near-total capitulation to the longstanding Republican wish list by congressional Democrats desperate to get something passed.
The bill was tough on immigration without turning the U.S. government into a kidnapping ring, as Mr. Trump did while president.
The Fed hasn’t been a major issue in this campaign, thank heaven.
But we can be pretty sure that a President Harris, like Presidents Biden, Obama, Bush and Clinton before her, would leave monetary policy to the independent central bank rather than bully the Fed from the White House.
On healthcare, Ms. Harris really does want to strengthen ObamaCare rather than undermine it.
She offers more than “concepts of a plan.”
On climate change, the vice president stands proudly on the Biden-Harris record.
While there is more to be done, the various CO2-reducing measures in the Inflation Reduction Act are the biggest and boldest steps the U.S. has ever taken to slow global warming.
Score another point for Ms. Harris.
I could go on, but I haven’t the space.
More important, the noneconomic aspects of a second Trump administration are far more horrifying, including his threats to use the full force of the federal government against the “enemies from within,” and his willingness to hand Ukraine over to Vladimir Putin.
He might even cause the end of the North Atlantic Treaty Organization.
As the saying goes, “Fool me once, shame on you.
Fool me twice, shame on me.”
Here’s hoping America won’t be fooled again.
Mr. Blinder is a professor of economics and public affairs at Princeton. He served as vice chairman of the Federal Reserve, 1994-96.
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