From the Milken Review, Clifford Winston:
…Trump’s first term offers little reason for optimism, at least from my perspective as a political independent and a mildly right-of-center microeconomist. Indeed, there is little in his record of governance to suggest that his policies will promote competition to the benefit of consumers or that he will use the levers of government to accelerate technological progress.
The Big One
The most damaging market failure of our time is the delay in coming to grips with greenhouse gas emissions that are warming the planet. … his administration fought efforts to phase out coal-fired electricity generation and mocked the expansion of private-sector investment in wind energy, the lowest-cost alternative energy source in much of the country. Then, too, he withdrew from the Paris Agreement that obliges signatories to reduce GHG emissions, thereby giving aid and comfort to other countries that are happy to “free ride” on the efforts of others to contain climate change.Monopoly Matters
The government has discretion to enforce a string of laws designed to curtail firms’ anti-competitive behaviors that raise prices, reduce output and slow innovation. The extent of anticompetitive behavior in the United States is a matter of scholarly debate, but Trump has shown no interest in taking sides. Instead, his administration largely used antitrust policy as a tool for retribution. …
Trade
Trump’s lack of focus on the value of competition is further reflected in his longstanding opposition to free trade. …
This thrust toward protectionism has been felt in other markets, too. Deregulation of air, truck and rail transport in the last quarter of the 20th century greatly benefited consumers and shippers by unleashing competition, which reduced both costs and prices and spurred technological advance. Parts of the transportation system are still regulated to prevent foreign firms from competing with U.S. firms. But the Trump administration ignored opportunities to build on transportation deregulation’s successes by eliminating this barrier to competition. …
Infrastructure
Trump originally campaigned for office with the promise of massive infrastructure renovation, but his administration failed to advance any infrastructure legislation through Congress. The lower-profile but almost-as-important lapse on this front, however, was his administration’s unwillingness to press for the privatization of infrastructure services that have plainly failed as public entities.
Take air traffic control. Nav Canada has been widely acknowledged as an example the U.S. could follow by spinning off the Air Traffic Organization from the Federal Aviation Administration and running it as a nonprofit. Trump initially backed this change, but he inexplicably pulled his support, so the bill never made it to the floor of Congress. …
Technological Progress
… the Trump’s administration’s efforts to reduce visas for skilled workers as part of his war on immigration constituted a threat to the nation’s ongoing technological progress. Fortunately, his attempt to choke off entry was parried by the courts. There is no guarantee, though, that he wouldn’t succeed in a second term. …
See Winston’s previously cited here and here.
Full disclosure: I was Dr. Winston’s research assistant 1984-85.
“The government has discretion to enforce a string of laws designed to curtail firms’ anti-competitive behaviors that raise prices, reduce output and slow innovation.”
His JEL paper is something I’m reading today. Thanks. The anti-competitive behavior of the food processing sector is at the center of what Harris is saying about food prices. Of course the economics of market power is something neither Trump or his little minnie-me (Bruce Hall) will ever grasp.
“See Winston’s previously cited here and here.”
Must read as Winston gets the transportation sector. This new post shows his expertise spans a wide array of policy issues.
“The lower-profile but almost-as-important lapse on this front, however, was his administration’s unwillingness to press for the privatization of infrastructure services that have plainly failed as public entities.”
“Unwillingness to press for” needs further discussion. Trump did, in fact, agitate for a private-sector infrastructure project, to be 80% financed by tax expenditures, while fees would be collected from the public. The proposal was a giant, tax-payer funded scam to enrich private interests. It was so bad that even members of Trump’s own party wouldn’t sponsor true necessary legislation.
Biden then successfully promoted a large infrastructure bill. Job done.
“Plainly failed” is also debatable. Air traffic control is a bottle-neck, yes, but:
“Every day, FAA’s Air Traffic Organization (ATO) provides service to more than 45,000 flights and 2.9 million airline passengers across more than 29 million square miles of airspace.”
https://www.faa.gov/air_traffic/by_the_numbers
Seems somewhat better than “failed”. Certainly not “plainly”.
Halfway into his JEL paper:
Feenstra and Weinstein (2017) estimated that the increase in U.S. import shares between 1992 and 2005 raised U.S. welfare by nearly 1%, with the source of the gain equally accounted for by the decline in price-markups and by greater product variety. Amiti et al. (2017) found that China’s imports to the United States following its entry to the World Trade Organization in 2001 improved consumer welfare by reducing the price of its inputs, which reduced the price of final manufactured goods 8%, while Bai and Stumpner (2019) estimated that Chinese imports led to
roughly a 0.2 percentage point annual reduction in the price index for consumer tradables. Finally, even professional sports teams in the United States have relied on foreign inputs to increase their competitiveness. For example, Depta (2015) reports that baseball players from the Dominican Republic and Venezuela accounted for nearly 20% of major leaguers in 2015. The disciplinary impact of foreign competition has been weakened, however, by the generally protectionist policies of the Trump Administration. Yet few, if any, politicians (or even academic scholars) who have been calling for much more aggressive antitrust enforcement have pointed to the importance of avoiding trade protection to enable market forces to flourish.
But Trump protests that his tariffs have not hurt any American. Talk to anyone who had to pay sky high prices for a washer and dryer.
I noted a short interview (via youtube) of Jason Furman back in 2018 at the OECD. Here’s his presentation:
https://one.oecd.org/document/DAF/COMP/WD(2018)67/en/pdf
Market Concentration – Note by Jason Furman
Hearing on Market Concentration
7 June 2018
Liars like Bruce Hall have tried to claim Furman believes the food sector is perfectly competitive. Liars like Bruce Hall owe Dr. Furman an apology.
Can we talk about the bio of Dr. Donald Harris (whose daughter became Vice President and may become our next President)? I ask this because economic Know Nothing Donald Trump says Dr. Harris was a “Marxist”.
Well he did his Ph.D. from Berkeley and Dr. Chinn will let us know whether that makes him per se Marxist.
He held professorships at the University of Illinois at Urbana-Champaign, Northwestern University, and University of Wisconsin-Madison before joining Stanford University as professor of economics. He was the first Black scholar granted tenure in the Stanford Department of Economics.
Stanford is not exactly the hot bed of Marxism but once again Dr. Chinn can tell us whether teaching at UW-Madison makes one a Marxist.
I have yet to read Capital Accumulation and Income Distribution (1978) but I doubt Trump has either. He was an economic advisor to the government of Jamaica? Is that why he has to be a Marxist?
Earnest question: How is it that one of Menzie’s old friends in his early growth in life (Mr. Winston) could be so perceptive, and wise, and insightful, and another of Menzie’s acquaintances in his early growth (Peter Navarro) later become a total psycho??? Similar to the number of licks on a Tootsie Roll lollipop……. the world will never know.
The Big One
The most damaging market failure of our time is the delay in coming to grips with greenhouse gas emissions that are warming the planet. Even if one does not believe the climate is changing — a hard belief to hang onto in the face of the science, not to mention the record of accelerating weather disasters — there can be no disagreement that pollution is a negative “externality” that should be contained efficiently with extra-market incentives, such as by taxing polluters according to the damage that pollutants do to the environment and human health. Trump, alas, has never expressed support for creating incentives of any sort, market-based or otherwise, to reduce emissions of carbon or methane, or for that matter, even for acknowledging that fossil fuel use is a threat.
Youve seen this live here as in the trash people like CoRev and little Brucie boy Hall spew routinely. Hey – there are no externalities as global warming is good for everyone. Trump leads an army of utter morons. Forget them ever understanding economics. They failed basic science. MAGA!