Here’s the latest. Bloomberg:
‘Trump now threatening 100% tariffs… unless you use the dollar that he is determined to depreciate.’
‘Donald Trump pledged on Saturday to make it too costly for countries to shift away from using the US dollar, adding a new pillar to his tariff platform. “You leave the dollar and you’re not doing business with the United States because we are going to put a 100% tariff on your goods,” the Republican presidential nominee said at a rally in the battleground state of Wisconsin. The statement follows months of discussions between Trump and his economic advisers on ways to penalize allies or adversaries who seek active ways to engage in bilateral trade in currencies other than the dollar.’
Trump is the first US politician to reveal this part of the scam. The idea is to inflate away the value of the US dollar… but also to trap foreigners in the depreciating currency.
It’s either inflate… or die. The US economy may be a grotesque zombie with debt growing three times as fast as GDP. But neither political party has the courage to drive a stake through its heart. So, inflation it will be.
And Donald Trump threatens to make it worse.
As we know, raising the national debt also raises the cost of debt service (interest). Already over $1 trillion per year, the feds then have to borrow more money to pay it. And this leads them…alas…to ‘print’ money.
While campaigning in 2016, Mr. Trump offered to help solve this problem by not only balancing the budget, but by paying down the national debt. Of course, it didn’t happen. Instead, his four years in the White House saw debt increase from $20 trillion to $28 trillion — a 40% increase.
Now, he’s running for office again… and promising more marvels. The Washington Post:
‘Trump is vowing to make permanent the measures from his first tax law, which could add an additional $4 trillion to the debt. Many of those tax provisions are otherwise set to expire next year. Several other plans endorsed by Trump, including eliminating taxes on tips and a further reduction in the corporate tax rate, would bring his total tax cut plans above $6 trillion and as high as $7 trillion, according to nonpartisan budget experts.
‘Bloomberg News has estimated the price tag at $10 trillion; that figure includes a $5,000-per-child tax credit called for by Sen. JD Vance (R-Ohio), Trump’s running mate, which Trump has not endorsed…’
You gotta hand it to Mr. Trump. Who else would have the cojones to suggest adding $7 trillion to the national debt? But wait. He says that this time he will offset the tax cuts with spending cuts. The Post continues:
‘In a speech at the Economic Club of New York on Thursday, Trump promised “trillions” of dollars in spending cuts from a new government commission… that would save “trillions of dollars — trillions. It’s massive. For the same service we have right now.”
‘“We’re going to have so much money coming in. We’re going to work on the national debt,” Trump said. “We have to get that down…”’
Ha. Ha. Were these people born yesterday? Or do they think we were born yesterday? Of course, there are trillions that could be cut from federal spending. But each one of those dollars, like raw meat thrown to a pack of hyenas, goes to someone with sharp teeth.
The Trump team claims it will eliminate ‘waste.’ But there is no ‘waste’ in Washington. Every penny buys influence. And influence buys Washington.
Mr. Trump also says he won’t touch Social Security, Medicare, veterans’ benefits…or the military. But…
‘“From a purely mathematical perspective, if you’re talking about cutting trillions in spending, you are talking about cutting Medicare, Social Security or veterans benefits. There’s no other way to make that math work,” said Bharat Ramamurti, who served as deputy director of the White House National Economic Council under Biden.’
And there you have it.
Have what?
Well…bankruptcy. Inflation. The end of the empire. The end of the dollar. A failed state. It’s all there. You can’t really cut spending without digging into the big spending programs. Neither candidate is willing to do that. And Congress has shown even less backbone; it will cut taxes…but not spending.
And if cutting taxes will help you get elected…and not cutting spending will help you get elected, then the people who get elected are much more likely to cut taxes than cut spending. And deficits, money-printing and inflation are much more likely to be the way forward than responsible budgeting.
Mr. Trump’s latest proposal is just a way to stick foreigners with some of the losses.
Regards,
 |
Bill Bonner,
For Fat Tail Daily
