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Big Business Reaps Trump's Whirlwind

July 06,2018 04:18

The imminent prospect of a trade war, it seems, concentrates the mind. Until very recently, big business and the institutions that represent its interests didn't seem to be taking President Trump's protectionist rhetoric very seriously. After all ...

When organizations like the Chamber of Commerce or the Heritage Foundation declare that Trump’s tariffs are a bad idea, they are on solid intellectual ground: All, and I mean all, economic experts agree. But they don’t have any credibility, because these same conservative institutions have spent decades making war on expertise.
The most obvious case is climate change, where conservative organizations, very much including the chamber, have long acted as “merchants of doubt,” manufacturing skepticism and blocking action in the face of overwhelming scientific consensus. Not to put too fine a point on it, it’s hard to pivot from “pay no attention to those so-called experts who say the planet is warming” to “protectionism is bad — all the experts agree.”
Similarly, organizations like Heritage have long promoted supply-side economics, a.k.a., voodoo economics — the claim that tax cuts will produce huge growth and pay for themselves — even though no economic experts agree. So they’ve already accepted the principle that it’s O.K. to talk economic nonsense if it’s politically convenient. Now comes Trump with different nonsense, saying “trade wars are good, and easy to win.” How can they convince anyone that his nonsense is bad, while theirs was good?
But a trade war may be only the start of big business’s self-inflicted punishment. Much worse and scarier things may lie ahead, because Trump isn’t just a protectionist, he’s an authoritarian. Trade wars are nasty; unchecked power is much worse, and not just for those who are poor and powerless.
Consider the fact that Trump is already in the habit of threatening businesses that have crossed him. After Harley-Davidson announced that it was shifting some production overseas because of trade conflicts, he warned that the company would be “taxed like never before” — which certainly sounds as if he wants to politicize the I.R.S. and use it to punish individual businesses.
For the moment, he probably can’t do anything like that. But suppose Republicans retain control of Congress this November. If they do, does anyone think they’ll stand up against abuses of presidential power? G.O.P. victory in the midterms would put a lot of people and institutions at the mercy of Trump’s authoritarian instincts, big business very much included.
But organizations like the chamber and Heritage are still trying to ensure a Republican victory. In fact, until its recent shift in focus to protectionism, the chamber was running ads trying (unsuccessfully, it’s true, but still) to build public support for the Trump tax cut in competitive House districts. Compare this with those free-trade ads, which serve no clear political purpose.
The point is that it’s not just world trade that’s at risk, but the rule of law. And it’s at risk in part because big businesses abandoned all principle in the pursuit of tax cuts.

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