Just as expected, the second quarter GDP figure released today by the Department of Commerce was in the neighborhood of 4 percent -- 4.1 percent, to be exact.
This comes as no surprise to those of us who have long supported President Trump's plans to cut corporate and personal income tax rates, and hack away at the thicket of job-killing, Obama-era regulations. Admittedly, I was not enthusiastic at first about tariffs, but the more I studied the issue, the more I came around to the need to use tariffs as a cudgel against other nations just as they've done to us for years.
I had read about hollowed out towns, the devastation of major employers pulling up stakes and heading for the Third World, leaving unemployment, foreclosures, hopelessness and substance abuse in their wake. I was aware that China, India and many other countries pay dirt wages, do not adhere to environmental or workplace safety regulations, and often subsidize the companies that compete against our corporations and small businesses.
But what really shook me to the core was seeing the devastation first-hand. On the job a few years ago, I traveled far and wide, in two dozen states, most of them east of the Mississippi. I was shocked at the pervasiveness of desolate towns, boarded up main streets, closed factories and rural poverty. Yes, I was already aware that rural poverty is severe and widespread (and grossly under reported, since urban areas get much more attention). But seeing really is believing.
Contrary to the "conventional wisdom" as spouted by Never Trumpers and other establishment types, we're not going to relive the Smoot Hawley Tariff Act of 1930. For starters, our nation is not in a depression, and the economy has changed drastically in the past 90 years. The markets of 2018 are more sophisticated, dynamic, multi-faceted, resilient, technologically advanced, and intertwined by the four corners of the world.
The fact is, China, India and Europe need the United States. We are the wealthiest nation, the most lucrative market, the spoon that stirs the drink. China can threaten and bluster 'til the cows come home, but that nation is in a precarious position trying to keep 1.4 billion people fed and reasonably content. Eliminating hundreds of millions of consumers from purchasing Chinese products would have a crushing effect on jobs, economic growth and social stability in the Middle Kingdom.
Let's get this straight: Tariffs are not Donald Trump's end game. They are simply a bargaining chip. But one that Trump is using, albeit temporarily, to show he means business. Indeed, the European nations hit by U.S. tariffs have already agreed to step up to the bargaining table. Mark my words, we'll work something out with them. Can China be far behind?
Also consider the back-up plan. If, for some reason, high tariffs remain in place on products from a certain nation, the companies of that nation may well elect to construct plants in the United States to avoid the tariffs. So it's a win-win. But it seems more likely that agreements will be reached to avoid the most severe tariffs.
And now, before I get back to the improving economy, a quick word about NAFTA, the Trans Pacific Partnership and other grandiose trade schemes. I have long believed that major legislation that brings Republicans and Democrats together, patting each other on the back and boasting about what a wonderful thing they've done, usually stinks to high heaven.
The Patriot Act, No Child Left Behind and the McCain-Feingold campaign finance "reform" are three examples off the top of my head. These big trade deals are thousands of pages long, which opens up pandora's box for mischievous lawyers, bureaucrats and politicians. Carve-outs for special interests permeate like bed bugs in a flophouse. And we, the hard working people of middle America, are the ones getting bitten.
For the many thick-headed politicians who STILL don't understand why Donald Trump beat St. Hillary, YOUR TRADE DEALS SUCK! Get the hell out of New York, San Fran and the Beltway, and see how the other half lives! It won't kill you to eat at Cracker Barrel a few times, or to drive through hundreds of miles of corn fields. You might just find that we folk out here in flyover country are pretty nice, decent, down-to-earth people. You might also see, for the very first time, what those pie-in-the-sky agreements reached by jet setters in the five-star hotels at world class resorts actually do to the average Joe. It might be a soul-awakening experience.
But back to today's good news... For many years, corporations off-shored plants and jobs to avoid the world's highest corporate tax rate. No more. The incentive to build in the United States, and to move those customer service centers and tech support staff back here is great, with the reduction in the corporate rate from 35 to 21 percent. The personal income tax cuts will help millions, and while those in states with high property taxes will complain bitterly about their deductibility being capped, chances are they will benefit from new job opportunities, rising wages and a booming stock market.
True to form, the dim bulbs of the corrupt news media are trying to spin today's news as a one-off, an anomaly created by farmers and others rushing to sell large volumes of products to other countries before tariffs kick in. The dunderhead reporters, most of them illiterate when it comes to economics, don't have a clue about how lower taxes and reduced regulations incentivize investors, entrepreneurs and private citizens. Of course, that's partly because they attended universities that slam capitalism, extol socialism and do their best to indoctrinate their students to be good little liberals. Your average Midwestern farmer has more economic knowledge and common sense than does your typical Ivy League graduate.
I believe that once the tax cuts firmly take root, once better trade deals are negotiated, and the jobs reports continue to impress, we are headed for several quarters of 5 percent GDP growth. It is laughable to hear Obama slappies trying to give The Messiah credit for today's economic success. Let's see now, I seem to recall some of the Obama acolytes stating a few years ago that 2 percent GDP growth was the new normal, that we shouldn't expect anything more than that. Um... what happened?
And on another note, it is interesting how the same people who believe the previous administration has a great effect on what happens to the next administration (i.e., Bush economic collapse screwed Obama; Obama policies helped Trump) were singing a differrent tune following 9/11. That was all George W. Bush's fault, you see. He was president in a vacuum -- never mind the crippling intelligence barriers and PC mindset put in place by the Clinton administration such as Jamie Gorelick's infamous "wall."
But I digress. Let's raise a glass to the Trump economy, and thank our lucky stars that the execrable Hillary is not president!
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