By Derek Danneker
February 23, 2017
Mr. John Tamny; Editor for Forbes Magazine and RealClearMarkets, Economic Advisor to Toreador Research & Trading as well as Author of Popular Economics, lectured a room of 75 students and community members Monday on President Trump’s Economic Policies.
Tamny, brought by the University’s own Sociology club and Young Americans for Liberty Club (YAL), is a Libertarian Political Economist who stresses that the well being of the United States Economy lies in decentralized government as well as lower federal spending and federal taxing leading to “a good blend of economics and political theory” described by Nicolas Feidt, a senior secondary education major, leading to a “comprehensive talk considering the clubs involved”
According to Tamny “nothing can be simpler than economic growth.” As long as the United States government avoids the four barriers to it:
Taxes, which Tamny describes as the “penalty for work,” Why would the federal government use taxes to punish spending and saving money while expecting the economy to grow?
Regulations, “let’s be clear, regulations do not work,” it stymies growth by forcing businesses to spend time and resources rather than focus on innovation and profit. The concept of regulation “fails on it’s face, it is an expensive burden that achieves less than nothing.
Floating money values, “money is just a measure that facilitates exchange and investment.” if the value of money changes, it is robbed of its singular purpose. The end result of this is that we spend less and invest less.
Tariffs on foreign goods, Free Trade is good for everyone, it allows people to focus on what they’re good at and import what they are not. Specialization “maximizes the possibility that we the individuals will be able to do the work that most elevates us.
Framing these points historically Tamny explains the last Century. In the 1920s there was a recession which is seldom talked about because it was quite short. It’s shortness is due to the federal government doing “less than nothing” in “textbook perfect economics.” Federal spending was slashed, The government “has no resources so when the economy is weak it is necessary to pull back and put money into the private sector,” the dollar was kept at 1/25 the ounce of gold. These decisions lead to the roaring 20s.
Tamny stresses that in fact as difficult as they are recessions are beautiful because they “signal a coming economic boom” by cleansing the economy of “bad habits and bad investments” recession is the cure for all that is not working.
In 1929 another recession hit. This time, However, Hoover and Roosevelt seized federal centralized power, which Tamny points out was never allowed by the constitution. Trying to shield the american people from the short term recession, They increased governmental spending which only “shifts wealth from one set of hands to another with no result in productivity.” Both Hoover and Roosevelt rose taxes which halts risk taking by the “vital few” or in modern terms, the one percent. Hover also signed the smoot hawley bill which rose tariffs on foreign goods, in response exports plummeted. These mistakes led to the great depression.
Looking at President Trump’s economic policies through this lens then, “on taxes, donald trump is largely good” he wants to, for the most part reduce taxes on corporation tax and the estate tax to name a few. Removing taxes allows the extremely rich to take more risks because they “have money to lose.” He also wants to reduce regulation, also quite good.
President Trump’s ideas on Tariffs though, are “terrifying.” we would import and export less, making us, the people, waste time doing things we are not good. “Very dangerous on it’s face” they are “a great way to crash an economy.”
Finally, President Trump believes that devaluing the dollar will help people. But if we earn less we buy less and investors that make many companies possible, invest less.
According to Tamney then, he gets “two out of the five”. But his views on trade are “dangerous” and if he goes down the path he seems to be going he will have a terrible presidency.
Tamney’s hope then, is that “ he will play golf all four years. If he does, we know he will have a good presidency.”
Nathan Kreider, a senior health science major and President of YAL, was “content” in the turnout citing less extra credit given for attendance. He loved his idea of “Local tax program” and decentralized government which would limit the damage of any federal Presidency.
The Young Americans for Liberty Club meets Tuesdays at 6:15 in PUB room three.