The press and wall street have reacted to the President Donald Trump’s address like the kids who were told to eat a bag of candies instead of attending the class. The wall street, the pinnacle of rogue stupidity and callousness reacted quite positively. They think it augurs well for their next quarter. Exactly what did Trump say? I just want to break it down for the purpose of people who haven’t heard it. I have followed Trump’s speech as is and you can look at the transcript if you want to map it back to his words.
http://www.telegraph.co.uk/news/2017/03/01/full-transcript-president-donald-trumps-first-speech-congress/
http://www.aljazeera.com/news/2017/03/transcript-donald-trump-congress-speech-full-170301060306943.html
Summary
As it is a fairly long post, I want to start with a summary. I agree with Trump on withdrawal of TPP, need to look at American jobs, need to invest in infrastructure, and need to provide support to veterans. However, this entire speech was littered with flaws. Firstly the numbers don’t add up. Trump has decided to cut taxes for the rich. Then, he wants to spend more on infrastructure and military. Where does the money come from? He is going to touch your social welfare. Secondly, he hasn’t mentioned a word on climate change. Thirdly, he has contradicted himself a lot, especially on the environment front. Overall, it has nothing worthy of greatness. I don’t want to compare it to Trump’s other speeches and say that this one is relatively better. There is a certain basic standard I expect and this one falls short by miles. The stock market has reacted positively purely on the basis of tax cuts for the rich and deregulation. It is a system that hasn’t learnt any lesson from the Global Financial Crisis.
Let us get to the details now.
1.0 Introduction
In a typical Trump fashion, he started the speech talking about violence in America. For a person who criticised Obama and the democrats for refusing to call Islamic terrorism as it should, he didn’t mention about what was the motivation behind the vandalism of Jewish cemeteries or the shooting in Kansas city. Both were indeed crimes done by Christians, who in some way believed the victims were responsible for their plight. That said, I am ready to give Trump the benefit of doubt on this.
2.0 Identification of the problems
He then went on to speak about the problems facing the United States of America. He got most of the problems spot on. The dwindling middle class, the crumbling infrastructure and the impact on wars are the major areas of concern. To Trump’s credit, he has been getting that story right and it has contributed immensely to his election success. However, there were two points of contention here. The first one is wealth to foreign countries. It is factually incorrect. The wealth actually is with the US companies. It is with the top 1% of the world and most of them lodged in tax heavens. The second one is having wide open borders. Again it is an alternate fact which was purely inserted to build a wall or insult the Mexicans.
3.0 Vision
Trump followed it up with a rhetoric on how he will make America great again. There are two parts to admire, two to fear and one to be really sceptical. Let me start with the good parts first. The military needs support, especially its veterans. The crumbling infrastructure should be replaced and hopefully by employing people in the US. The parts to be worried about are his attack on drug and inner cities. No country has worked out this drug war strategy well. They have taken medicinal and recreational use out of the equation. Further, this has been used for decades to target innocents. The epidemic is not drug flow but it is drug war. The neglected inner cities comment is an excuse for stop and frisk. It is a direct excuse to mishandle the youth from minority communities. The safety is a direct reflection of poor gun control and the lack of opportunity is a reflection of the dwindling social support. What feels like an inspiring paragraph, is actually a plot to crush the society further. The last bit is the roaring back to life, for the dying industries. The industries that Mr.Trump is talking about here are, fossil fuel, mining and heavy engineering. The loss of jobs for people in these industries is much more nuanced than outsourcing to other countries. Further, these are directly responsible for the environmental hazards which Trump doesn’t believe happens.
4.0 Achievements
Trump then moves on to talk at length about his achievements. This section was filled with threats, rhetoric, good points and loads of alternate facts. I will break this down into individual parts to make assimilation easier. This is an important section as it is easy to either ignore good points or miss the deeper meaning of the problem.
Making Companies investing the US
Trump started by stating a fact on companies which have decided to invest in the United States and stock market gaining momentum. There are two points to note in this. Firstly, he doesn’t say he is responsible for both these items. That also absolves him of any future issues with both these which is bound to happen. All these companies have decided to invest in the United States, but it will not create American jobs as much. The reasons are
- There are existing vacancies in the technology sector and specific skills in demand, which the US is unable to fill. This is because of the erosion in public education which has happened over generations.
- The unskilled jobs will pay minimum wage to people is not going to help. Most of them are already paid minimum wages and can’t sustain a family with that.
- Companies like Intel, Softbank, Lockheed and Walmart will invest heavily in automation, which will result in lesser jobs and not more.
- Lockheed already holds a lot of federal contracts for missiles and jet fighters. I am sceptical about this.
This is another age-old technique which comes from trickle down economics. It just doesn’t work.
Cheaper F-35 Fighter Jets
Trump moves on to showcase his negotiation skills with the price reduction of F-35. The reduction in the price of the F-35 should come with a catch phrase. It will either mean the United States government is buying more in order to keep up the revenue or giving them tax grants to stay profitable. Either of which is actually dangerous. If it is the first point, then it means Lockheed is cutting down its margin for additional revenue. An extension to that is the US government is increasing its arsenal. That has never ended up well for some sovereign state, especially in the middle-east. If it is the latter, then the effect is almost the same for the US balance sheet. You have cut the spending and the income which deficit at the same level. My fear is it is both. Lockheed has been given order for more and also given tax cuts. Any half-decent economist will be wary of that move, not Wall Street though.
Draining the Swamp
Trump next moves to the much anticipated draining the swamp mission. His statement (as seen below) is an amazing distraction. On a cursory look, it feels great that he has banned such lobbying. However, if we look deeply we will realise that there is not need for lobbying anymore. He has got the lobbyists in his cabinet now. He has got Rex Tillerson, Steven Mnuchin, Betsy DeVos, Elaine Chao, Gary Cohn, Steve Bannon and Wilbur Ross to name a few in his cabinet. You don’t need lobbyists after this group. They are the swamp.
Deregulation
The next part of the speech talks about de-regulation. The regulation that Trump talks about are the regulations which were put to prevent another financial crisis like 2008. He has removed all regulations protecting the environment. The removal of these regulations is not going increase jobs, it is going to put the industry at risk and susceptible to another recession. It is going to let industries use machines to automate more manual labour. It is going to allow industries to not obey any environmental laws. It is going to put lives of millions at risk. This technique propagated by neo-liberals starting Ayn Rand to Ronald Reagan has never worked and will never work.
North Dakota Access Pipeline
I never thought one can put construction of this pipeline in a sentence and make it is sound positive, but Trump proved me wrong. It would have been a positive initiative if Trump has signed an order to start manufacturing solar cells in America. This particular order will not create any new job apart from the already created ones for the pipelines. The pipeline puts the communities of the water protectors at risk, it threatens the lives of people dependent on that water and it endangers the millions of species living in the river. It is a horrendous move which can be only supported by corporate boot lickers.
TPP
There were two positive points of this segment, one was withdrawal from TPP and another was helping woman entrepreneurs with Justin Trudeau. I am in favour of the US withdrawing from the TPP. This is an ‘a la Nixon’ move which is what got the US into this mess in the first place. It is good to see him collaborate with the charismatic Canadian prime minister. I still don’t know what topics they have in common.
Security and protecting citizens
The citizen protection segment reeks Steve Bannon. It is a facade to crack down on any movement supporting minority rights. It is a direct threat to initiatives like ‘Black Lives Matter’. The drug treatment part of this is good but not sure who is going to pay for the treatment. I don’t know if it is a coincidence that the mechanics of any progressive move hasn’t been explained by Trump.
Immigration
Trump moved on answering the pleas of American people on immigration. This is another part which is factually incorrect. The US has a problem with unemployment but not with immigration. This statement combines problem, attributes that to his xenophobic fears and provides a solution which only boosts his complex without solving the problem. The net flow of Mexicans into the US is negative. The great wall is not going to stop drugs even if you think drugs are a problem. Further, moving people out is not going to save billions, it is going to hurt the US treasury. The wages will increase if you actually raise the minimum wage.
“As we speak, we are removing gang members, drug dealers and criminals that threaten our communities and prey on our citizens.” This reminds me a lot of Rodrigo Duterte, comfortable the most dangerous democratically elected leader in this world. The moment we start accepting the government use words like removing people, it is a matter of time before it gets abused. This is exactly why when Obama passed NDAA, it gets really dangerous. People like Trump can use that to suspend Habeous Corpus on any individual.
ISIS
I have to agree with Trump that ISIS is a civilisation threat and has to be handled effectively. However, that doesn’t extend to the next statement. Every offence that has happened in the United States has come from people outside the country. The country is the land of immigrants except for the native Americans. I am sure there are people belonging to KKK, who are laughing as Trump says these. The interesting point here is that Trump has directed his Department of Defence to develop a plan to destroy ISIS. Didn’t he say he already has one? The biggest point is if Trump is even remotely serious about eliminating radical Islamic Terrorism, then the first country to address is Saudi Arabia. I don’t think any of the western nation is interested in doing that. Saudi Arabia is worse than Iraq or Iran in terms of its policies.
Isreal and Iran
However, the unquestioned support for Isreal is a pity. The policy of Isreal under Benjamin Netanyahu is not much dissimilar to Trump. He is occupying the whole of West Bank providing nil rights to Palestinians. Iran is just as corrupt but far less developed now. It is critical to continue and honour the peace deal which was brokered with Iran. The only additional benefit in Isreal is it has some free press and few more civil rights.
Supreme Court Judges
Finally, on the Supreme Court judges, Trump was all praise for Antonin Scalia. Mr. Scalia, a Ronald Reagan appointee was a real conservative scumbag. From his history, it does look like Neil Gorsuch would keep up that reputation. Scalia has been known to provide partisan, pro-conservative judgements all through his career. Just because he is dead doesn’t mean he is great. Trump has got to make 20 such appointments.
Policy Plans
Infrastructure Spending
This is another segment which I agree with Donald Trump. It is critical for the US government to initiate public projects, especially on the infrastructure side. The only way to boost a receding economy is by pumping in more money. You can get it back as private sector starts to see the benefits. This is classic Keynesian economic theory and it has worked.
Tax cut for corporations
” My economic team is developing historic tax reform that will reduce the tax rate on our companies so they can compete and thrive anywhere and with anyone”
This Reagan and Thatcher’s idea has never ever worked. Why don’t you give tax breaks to the poor, so that they can afford more? That won’t work because the moment you give them money, they are going to put it under their bed and it won’t drive growth. The same is true about the Corporations. If you reduce taxes, they will just put more in their pocket. It is not going to help the society anyway. Yes, if you ask Harley or Google, they will ask you to reduce taxes. Further, it is a lie or an alternate fact to say that the US has the highest corporate tax rate.
Foreign Trade
It feels bad, but I agree with Trump on foreign trade as well. This Nixon initiated make somewhere and sell in the US concept has deteriorated the US economy slowly. Countries should protect the local industries and help them bridge the gap before bringing foreign companies into their market. However, when Trump talks about taxing foreign goods heavily, he is going to incite a trade war. You cannot have heavy import duty on necessary products which you don’t manufacture. It is going to be transferred back to the consumers who can’t pay for it. The companies will suffer but your consumers will suffer more.
Health Care
Trump’s plan on health care almost accounts for everything but just doesn’t add up. It had words that most people wanted to hear without actually conveying anything. The core of the plan is, “I hate Obama Care and I am going to repeal it.”. I firmly believe Obama care can be improved and the only way to improve it is by making the rich pay appropriately. Let’s first start by listing down his features of the new plan.
- Not mandated
- Cheaper premium
- More options
- Protect all Americans
- Everyone including people with pre-existing conditions will have access to health coverage
- Purchase your own coverage
- Give state Governers the power to decide on Medicaid
- Bring down drug prices immediately
- Power to buy across state
There are few key points to be noted here.
#1: Access to health coverage doesn’t essentially mean they will be given. This will translate to low premium for people without issues and extremely high (almost unpayable) premium for people with conditions. Most people will have access but can’t essentially buy.
#2 Governers control over Medicaid. With most governors, especially in the Republican states not in favour of Medicaid, what do you think is going to happen? He doesn’t talk about not reducing Medicaid.
#3 When Bernie Sanders tablet the bill to import drugs and bring down drug prices, it was voted out by most Republicans including some sold-out democrats. What is the idea in Trump’s head to bring down drug prices?
Social Welfare
Trump is a master at stating the problem and give a solution which will enhance it. Most of his problem – solution fit are analogous to, “I know you have very little food left to feed your family, I will solve it by taking everything that you have got left.” Before one realises, he would have sold it and made money. Trump wants to make Child Care accessible and affordable, provide paid family leave, invest in women’s health and promote clear air and water. After saying this, he has come up with executive orders against abortion, removing environmental regulations, and starting the North Dakota access pipeline.
FDA – Deregulation
The story on Megan’s dad John is beautiful. The problem if he deregulates FDA, it will be a blessing for one Megan but it will kill few thousand others. He is setting a dangerous precedent as far as deregulation is concerned.
Education
Again Trump picks up an isolated story and uses that for a policy. I know someone who lived his life eating plain grass but it will work for everyone. The funding for the “school of choice” is a Betsy DeVos pet project. It is a way to take the available funds for schools and transfer them to charter schools and religious schools. I am sure that the religious schools will not include Madarassas. In summary, it is a funding for Christian education.
Social Safety
I just want to know if there is anyone in the US not tired of Trump’s rhetoric on Social Safety. He wants to create a police state. His facts on murder rate are wrong. He didn’t utter a word on the murder of innocent black men or racially motivated murders by white men. He instead points out incidents of violence by illegal immigrants. This is a direct way to instil a bias in people’s minds.
Increased spending in Military
Senator John McCain must have jumped up and down when Trump was talking about military spending. I am sure there is a way to keep US safe without having to spend more on their military. The reason is the USA spends more on their military than the next 7 or 8 countries combined. It doesn’t need more drones. They need to stop intervening in the affairs of sovereign nations. The reason the wars are lasting so long is not because of poor arsenal but because of poor planning and wrong target. The US needs to stop bombing countries in favour of Isreal and Saudi Arabia.
I appreciate Trump when he acknowledges that the US needs lesser wars and not more. However, the actions don’t seem to correlate with those words.
There are two areas though where I sincerely feel the US has to spend. The first one is taking care of its war veterans and the second one is to aid the countries which it has already destroyed. Those two areas definitely need support.
The End.