Ep. 146 Trump’s Fake Victories?

9 July 2018     |     Tom Woods     |     6

The economy may be doing well, says Krugman, but when you look closer at what Trump touts as his great economic victories, they’ve been neutral to negative. (Also: winners of the Contra Cruise contest announced!)

Krugman Column

Trump’s Potemkin Economy” (June 30, 2018)

LP Mises Caucus Speeches

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  • Clayton Soultz

    Sorry to hear I didn’t make the cut for the contest, but hats off to the winners. Looks like I will need to up my production value for next year.

  • Craig

    Where are the winning entries videos?

  • Intersnooze

    I’ll attempt to summarize, without leaving anything of substance out:

    Krugman then: It takes time for the capital investment encouraged by corporate tax cuts to increase wages and benefits.
    [Tax cuts pass, corporations issue immediate bonuses]

    Krugman now: Since the corporate tax cuts have taken effect, there have not yet been positive changes, so the theory that this helps the workers is false.

    Is that accurate?

    • martinbrock

      For executive benefits (like stock options), the effect of stock buybacks can be short term, depending on when options expire. I’m less concerned with Krugman’s hypocrisy than with the actual effect of the cuts. Krugman’s a political hack. Let’s agree on this point and move on.

      I agree that too little time has passed to judge any effect on long term capital investment increasing employee productivity and wages, but then we can’t say anything positive about the cuts on this score either, so Trump gets no credit for falling unemployment and rising wages at this point. The stock buybacks are a fact though.

      The question remains: are these cuts the sort we would expect to raise productivity and wages or only the sort we would expect to raise stock prices and executive compensation tied to stock options?

      • Intersnooze

        That seems to be only answerable by empirical observation.