Make Trump 2.0 Irrelevant Again

Posted on February 19, 2025 by Popular Economics Weekly

Answering Kennedy’s Call

“The United States now has the highest percentage of low-wage workers – that is workers who make less than two-thirds of the median wage- of any developed nation. Fully 25 percent of all American workers make no more than $17, 576 a year.” Harold Myerson The American Prospect,

We know how to counter the Trump 2.0 administration’s attempts to wreck the U.S. economy and our constitution from his past history. Blue states in particular have the power to keep their citizens healthy and safe. They did it in his first term, as I said in a 2017 Huffington Post article, when it was becoming obvious Trump wanted to act like an anti-democratic oligarch.

Climate change has been the target of Trump’s “drill baby drill” fossil fuel supporters since his first term, yet climate change poses the greatest danger to Americans’ health and safety, particularly to our west coast inhabitants (wildfires and floods) and east coasters (hurricanes and tornadoes), not to speak of the record low winter temperatures tormenting Midwesterners.

Huffington Post

“The U.S. just released its latest congressionally mandated Climate Science Special Report that says 2017 wreaked the most catastrophic destruction in 90 years with an estimated $175 billion in property damage. Only the San Francisco Earthquake (1906), Chicago Fire (1871), and Great Flood (1927) caused more destruction,” I said then.

Trump’s other first term attempts at relevance included, “his fiasco of an Asian trip, where he fawned over foreign leaders who gave him massive pageants, but no trade concessions, while abandoning the Trans- Pacific Partnership.

“The remaining 11 countries, including Japan, Australia, Mexico and Malaysia, said they had revived the Trans-Pacific Partnership (TPP) deal, a multilateral agreement championed under the Obama administration.

And also, “American leaders from state capitals, city halls and businesses across the country have shown up in force” in Bonn, Germany, to discuss carrying out the 2015 Paris climate agreement,” said California Governor Jerry Brown and Michael Bloomberg in today’s New York Times.”

This is when President Trump announced at the beginning of his Presidency that he was abandoning the Paris Accord in favor of supporting a return to coal and oil energy. But that wasn’t what the rest of America wanted, as some 50 percent of U.S. states and cities were represented in Bonn.

And now it is his indiscriminate use of import tariffs that threaten to wreck international trade.

President Trump’s attempts to return to the predominately white middle class of the 1950s have become irrelevant to most of the problems facing Americans and the world today. Trump is ignoring the damage revenge policies will do to the U.S. economy, and his own red state supporters by also attempting to destroy American’s social safety net, including cuts to Medicare and Medicaid that most harm red state citizens, protections against climate change, and wanting to downgrade the military alliances that have kept us safe.

Trump’s first term policies have been irrelevant in so many ways. He has done nothing for his red state supporters. As Thom Hartman highlighted in my last blog, red states continue to suffer most from:

— Spousal abuse
— Obesity
— Smoking
— Teen pregnancy
— Sexually transmitted diseases
— Abortion (at least before Dobbs; now it would be “forced births”)
— Bankruptcies and poverty
— Homicide and suicide
— Infant mortality
— Maternal mortality
— Forcible rape
— Robbery and aggravated assault
— Dropouts from high school
— Divorce
— Contaminated air and water
— Opiate addiction and deaths
— Unskilled workers
— Parasitic infections
— Income and wealth inequality
— Covid deaths and unvaccinated people
— Federal subsidies to states (“Red State Welfare”)
— People on welfare
— Child poverty
— Homelessness
— Spousal murder
— Unemployment
— Deaths from auto accidents
— People living on disability
— Gun deaths

Climate change is a good place to oppose Trump’s policies, since droughts have been a major cause of the worldwide migrations escaping from poverty that have upset the existing geopolitical order.

Let’s continue to make Trump and Republicans’ actions irrelevant that are attempting to destroy our federal government by supporting cities, states and even international organizations (UN, WHO?) that pursue the policies that have kept America great and the world at peace—policies that build rather than destroy, that breed trust and community, rather than hatred and division.

This doesn’t minimize the suffering Trump has already inflicted on so many Americans, but could mitigate some of the cruelty to come.

Harlan Green © 2025

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

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Trump Is No Populist

Posted on February 17, 2025 by Popular Economics Weekly

Answering Kennedy’s Call

An NBC News poll last April showed that Trump had a 26-point lead among voters who don’t follow political news. In contrast, voters who got their political news from newspapers, the most comprehensive form of daily news, supported Joe Biden by a vast margin, 70 percent to 21 percent. David French NYTimes

Mother Jones

It’s becoming clear what Donald Trump and Elon Musk have in common, when Musk has said he loves Trump ‘As Much as A Straight Man Loves Another Man’ on X. It is their unbridled greed that harms anyone in the way of greater fortunes.

Neither Trump nor Musk are populists. It is clear we are seeing two apex predators at work as the 2nd Gilded Age is peaking. They are doing what the Oligarchs who support Trump have always done, preyed on the weakest and most ignorant.

That is why corporate profits are at a post-WWII high, 11.8 percent of GDP, when Trump Republicans want even more tax cuts with the federal budget now 120 percent of GDP. And people without college degrees die about eight years sooner than those with four-year degrees, according to NYTimes David Brooks.

This is why women with only a high school degree or less are five times as likely to have children out of wedlock or women with a college degree. And by the sixth grade, children of poor families are performing at four grade levels lower than the children of affluent families.

These sad statistics cited by David Brooks in a recent NYTimes op-ed are the result of years of tax cuts without paying for them by Republican administrations that has made the red states they govern the poorest states. and resulted in the record federal debt we now have.

Worsening the harm to ordinary Americans, Trump and Musk want to root out DEI personnel and programs that promote greater opportunity and replace them with even less competent personnel, such as Pete Hegseth, JFK, Jr. and Tulsi Gabbard.

In just Donald Trump’s first week in office, it’s becoming obvious that the lies he promotes will be no different than during his first term as president. He is counting on the American electorate who voted for him to not believe what they are seeing, as I said recently—a worsening climate, worsening inflation, less healthcare services, military preparedness, and public education.

These disparities exist mostly in the red states, to no one’s surprise, where essential public services are less available. There is an enormous poverty gap between the red and blue states, and Republican administrations have done nothing to bridge it.

“Some of the chasms are sociological. People with only high school degrees or less are much more likely to say they have no close friends. They are more likely to live in towns where social capital is collapsing and the young are fleeing.”

Why is it so many Americans don’t believe what they see? This is largely due to where they live—the red states.

Thom Hartman of the Hartman Report, a NYTimes best-selling author, says it’s because Republicans worship cheap labor — and having a steady and reliable supply of cheap labor requires widespread poverty.

It is what Trump’s electorate voted for, while:

— Blue states account for about 71 percent of America’s GDP, whereas Red states only produce 29 percent of our income and wealth.
— The median family income in Blue states is $74,243. In Red states it’s $63,553. Individual states highlight the disparity: New Jersey’s median income is $89,703, while Mississippi’s is $49,111.
— Counties that voted for Biden in 2020 are more diverse, being 35 percent nonwhite compared to 16 percent nonwhite populations in counties that voted for Trump.
— Counties that voted for Biden in 2020 are better educated, with 36 percent of their population having some college education compared to Trump’s counties at 25 percent.
— Residents of Blue states live 2.2 years longer, on average, than residents of Red states. Hartman lists many more disparities on his website.

Why don’t Trump believers follow political news; news readily available in most mass media? It is why red state economies have foundered, while Trump wants to govern as he did his real estate empire; with family and loyal friends, no checks and balances; which has largely been a failure.

It is why the 2nd Gilded Age will end when Americans—particularly his populist supporters—realize this bromance of two ‘straight’ men will make all of US less safe, healthy, and wealthy.

Harlan Green © 2025

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

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Inflation Is Back?

Posted on February 14, 2025 by Popular Economics Weekly

Popular Economics Weekly

“Kentuckians can’t afford the high cost of Trump’s tariffs,” which could cost the average Kentucky resident $1,200 a year. “[P]reserving the long-term prosperity of American industry and workers requires working with our allies, not against them.” Senator Mitch McConnell

FREDconsumerpriceindex

Senator Mitch McConnell’s op-ed in the Louisville Courier Journal (thanks to Heather Cox Richardson) tells us why the former head of the Republican Senate voted against Pete Hegseth for Defense Secretary and Tulsi Gabbard for Director of National Intelligence. He considers their history of incompetence a threat to our national security.

And it looks like that will happen, if President Trump and his Oligarchs get their way with tariffs. But signs of higher inflation are beginning to appear in the New Year that may hinder their implementation of higher tariffs.

Senator McConnell had been the Democrat’s biggest thorn until now, including stonewalling Presidents Obama’s pick of Merrick Garland for the Supreme Court, but of late has been more concerned with the damage that President Trump may do to national security.

Most of the tariffs Trump has announced are targeting our closest allies, thereby weakening them economically. Our closest allies are also our largest trading partners, so they have the low-hanging fruit that Trump first wants to pick by collecting taxes on their exports.

This, of course, increases his wealth and that of his supporters, almost all billionaires in their own right. But a budget battle is looming in March over annual expenditures and the debt ceiling that must be raised to pay for the tax cuts they want, and little room to maneuver with Republicans’ thin House majority.

This also endangers just how Republicans have increased their wealth exponentially since the 1980s while chiseling away at the benefits (such as Medicaid) that increase the wellbeing of the less wealthy—many of whom live in the red states they control.

It is unfortunate that President Trump’s wave of tariff announcements have occurred at the same time as inflation is beginning to rise again. This is incredibly bad timing when he said that he would bring down inflation on ‘Day 1’ of his presidency.

For instance, the retail Consumer Price Index for prices that directly affect consumers is back up to 3 percent y/y after hitting its low point of 2.4 percent last September. The rise in prices was mostly due to soaring food prices (eggs/bird flu) and energy prices (gas and oil)—probably because of the very cold winter.

McConnell’s main worry seemed to be how the tariffs would weaken relationships with our closest allies that help to protect us from the likes of Putin’s Russia or China’s Xi. Trump is using tariffs as a blunt weapon to bring down the budget deficit, while disregarding national security concerns that tariffs are supposed to enhance, which should be to increase the sourcing of strategic raw materials, such as steel and aluminum.

But we don’t really have a problem with aluminum and steel sourcing because our current alliances already supply what we need. That’s why we know Trump’s real reason is not to enhance national security, but to enhance his own financial security enriching himself and the billionaire class by taxing more imports to bridge the huge budget deficit gap.

So how in fact can we reduce the current inflation surge? We must reduce the demand side of the equation, which the Fed is helping to do by keeping short term interest rates slightly higher (4.25% to 4.50%) than current inflation. It makes credit more expensive for investments as well as consumer spending.

Reducing government investments will also reduce demand, because it flows into the private sector where it’s spent by consumers and businesses. But the Oligarchs want only to reduce the size of government expenditures that don’t directly benefit them, such as healthcare, environmental protection, and consumer protection by reducing regulations they don’t like that also reduce their profit margins.

Why otherwise fire so many Inspector Generals who monitor financial misbehavior? Or, why fire so many FBI agents who protect our national security, which is a sign they care little about our national security.

The problem is how to make government more efficient, but that also benefits the less wealthy. Everyone agrees there’s a lot of waste, but also necessary public investments that improve infrastructure, protect the climate, and national Research and Development that the private sector won’t do.

But Oligarchs want only to cut the benefits of everyone else.

Harlan Green © 2025

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

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Are Consumers In Danger?

Posted on February 12, 2025 by Popular Economics Weekly

The Mortgage Corner

Total consumer credit rose $40.8 billion in December, after a $5.4 billion decline in the prior month, the Federal Reserve said last Friday. In percentage terms, it is the biggest gain since June 2022.

FREDconsumercredit

Will consumers lose their mojo? They shopped until they dropped during the holidays, which is why retail sales were up 3.9 percent in December as well. To do this consumers were spending more than they were earning. The question now is when will consumers run out of savings, and stop shopping? That will in fact determine economic growth in the New Year.

Revolving credit, typically credit-card debt, made up most of the increase, rising at a 20.2% annual rate. That follows a 12.1% drop in the prior month. Nonrevolving credit, mainly auto and student loans, rose at a 5.8% rate after a 2.7% rise in the prior month.

That’s the fine line the Fed’s Chair Powell is attempting to walk at their semi-annual congressional update this week. He didn’t say outright that the tariffs that President Trump has announced will cause inflation to spike so they can’t drop interest rates any lower, in answering questions.

“We are in a pretty good place,” Powell told the Senate committee – citing tariffs, immigration, fiscal and regulatory policy as the key variables the Fed will “try to make sense of”.

Therefore we won’t actually know the future until we see that happens when the new tariffs on imports kick in and those countries retaliate with their own tariffs on U.S. exports.

So January will be another story as consumers must begin to spend less to replenish their savings. A sign of their hurt is that the delinquency rate has risen, with some 3.5% of card balances past due by 30 or more days and 1.8% of accounts delinquent. Both figures are more than double the post-pandemic lows recorded in 2021, said Bloomberg.

Another hint on future consumer behavior is how small businesses are feeling. The NFIB Small Business Optimism Index fell by 2.3 points in January to 102.8. This is the third consecutive month above the 51-year average of 98. The Uncertainty Index rose 14 points to 100 – the third highest recorded reading – after two months of decline.

“Overall, small business owners remain optimistic regarding future business conditions, but uncertainty is on the rise,” said NFIB Chief Economist Bill Dunkelberg. “Hiring challenges continue to frustrate Main Street owners as they struggle to find qualified workers to fill their many open positions. Meanwhile, fewer plan capital investments as they prepare for the months ahead.”

Speaking of hiring challenges, Goldman Sachs put out a graph that shows just how important ‘unauthorized’ workers are to the U.S. economy. They make up approximately half of the jobs native-born Americans won’t take.

GoldmanSachs/MarketWatch

“The key risk is probably not a scenario in which annual deportations reach into the millions, but one where an immigration crackdown creates a climate where employers are afraid to employ unauthorized immigrants or unauthorized immigrants are afraid to go to work, potentially leading many to stay out of the workforce or even to leave the U.S. on their own,” said Goldman Sachs of their survey.

And we have just learned that inflation may be on the rise again, with the retail Consumer Price Index above 3 percent. The financial markets are reacting because of the news. It isn’t a good time to be imposing tariffs, in other words.

Harlan Green © 2025

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

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The Tariff Wars–Part III

Posted on February 11, 2025 by Popular Economics Weekly

Popular Economics Weekly

“It is inconceivable that other countries won’t retaliate, even if some of the governments might not want to retaliate, their citizens will demand that you can’t allow yourself to be beaten up. When you make like a gorilla thumping on his chest, are countries just going to say, ‘Are we chopped liver?’ Their politics will demand that they do something.” Nobelist Joseph Stiglitz

Krugman/Substack/Bloomberg

The real tariff wars have now begun. Not only has Trump announced 25 percent tariffs on all steel and aluminum imports but will soon instigate so-called reciprocal tariffs on those that impose tariffs in response.

Such blanket tariffs do not make economic sense, and it counters the advice of Trump’s own chief tariff negotiator, Robert E. Lighthizer.

Lighthizer, just wrote in a NYTimes Op-ed that “Countries with Democratic governments and mostly free economies should come together and create a new trade regime.”

Yet the just announced tariffs fall on our most democratic and free economic allies—Canada, Brazil, Mexico, South Korea, Japan, and Germany with which we already have trade regimes.

He has justified his tariffs with an outright lie; that foreign governments or export entities pay the tariffs when it is in fact a tax on the importer, or consumers when it’s passed on to the users of said imports.

Then why the lie, that Trump has maintained since his first term that didn’t work out so well for Americans? U.S. farmers, for instance, had to be reimbursed with taxpayer funds for the lost soybean and wheat exports that China would no longer buy.

Lighthizer all but admitted in a recent 60 Minutes interview why Trump has maintained the lie. The import taxes collected will help to finance the tax cuts that Trump wants, which benefit his wealthiest supporters, already immensely wealthy oligarchs, many sitting behind him during his inauguration.

And he cannot finance those tax cuts without a new budget agreement, because even his Republican supporters won’t tolerate a larger budget deficit with total federal debt now 120 percent of Gross Domestic Product, the highest since World War Two.

Does Trump really listen to his chief tariff negotiator when he has essentially abandoned just such existing trade regimes as NAFTA, the EU’s, or Obama’s Transpacific Trade Agreement? The 11 Asian countries left in the PTT agreement; Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam; went ahead and created their own trade regime when Trump abandoned it to keep from taxing each other’s imports.

The financial markets are reacting as they did when Trump first announced tariffs on Mexico and Canada, then quickly rescinded for 30 days—all indexes are plunging and interest rates continuing to rise in the expectation of higher inflation due to the rising prices that will follow.

And this at a time when the Federal Reserve must decide whether the inflation bogey man is back. Why wouldn’t those countries affected by Trump tariffs raise their tariffs in response, less they look weak to their citizens when Trump’s gorilla is thumping on their chests?

There is also the fact that higher taxes will mean slower growth, and so in wanting to appear strong, Trump will in fact be weakening the economies and alliances that have kept the U.S. strong.

Harlan Green © 2025

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Was It a Good Employment Report??

Posted on February 8, 2025 by Popular Economics Weekly

Popular Economics Weekly

Total nonfarm payroll employment rose by 143,000 in January, and the unemployment rate edged down to 4.0 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in health care, retail trade, and social assistance. Employment declined in the mining, quarrying, and oil and gas extraction industry.

FREDunemploymentrate

The economy added just 143,000 new jobs in January as massive California wildfires and a cold snap in much of the country acted as a drag on hiring. The details of the employment report point to a robust labor market that gained strength at the end of 2024. The economy averaged 233,000 new jobs from November to January, well above the 180,000

One economist determined that most of the new jobs were in the service sector, as I’ve been reporting, hence favored immigrants who tend to fill the lowest paying jobs that native Americans don’t want.

But it’s not just more wildfires we will have to worry about this year as world temperatures rise, but more hurricanes and floods, such as hit the east coast.

So what does that mean for 2025? It depends on what tariffs are enacted, what the Federal Reserve does with interest rates, and how many immigrants are deported, for starters. Then we still must worry about the effects of continuing wars and more climate disasters.

It would be nice if consumers continued to shop, in spite of what’s happening, which means they remain somewhat optimistic about their future.

However, the latest University of Michigan sentiment survey was a downer. Its gauge of consumer sentiment fell to 67.8 in a preliminary February reading, down from 71.1 in the prior month and the lowest reading since July.

Inflation was still their biggest worry. Americans’ expectations for overall inflation over the next year jumped to 4.3% in February from 3.3% in the prior month, according to the survey. That’s the highest level since November 2023, and it is only the fifth time in 14 years that there has been a one-month gain of that size.

It’s really how American consumers react that determines economic growth and hence the job market. The Los Angeles fires were one reason the January nonfarm payroll total was low. The recent hurricanes also punched another hole in employment. Forbes Magazine reported last October that Hurricane Helene was expected to cause a reduction of 40,000 to 50,000 payroll jobs with Hurricane Milton adding to the total.

And I won’t even try to predict when the Gaza and Ukraine conflicts will be resolved, or what it might do to the world economy with energy prices soaring.

The bottom line seems to be that the U.S. economy is escaping much of the damage because the Fed has been proactive over the inflation danger, and has been saying it wants to lower interest rates further to support the job market.

President Biden’s massive new, New Deal investments with the infrastructure, CHIPS, climate change, and healthcare legislation will also be benefiting U.S. economic growth for years to come.

Economists are also estimating that the 3 million new immigrants added to the workforce over the past two years has made such growth possible. Will that continue if our worker shortage worsens?

“The flood of fresh labor eased a worker shortage after the pandemic and allowed the economy to add more jobs without driving up wages and inflation. Normally, rapid job creation tends to exacerbate inflation,” says MarketWatch’s Jeffry Bartash.

Did the influx of new immigrants hurt American workers? Economist Wendy Edelberg, director of the Hamilton Project at the Brookings Institution, estimates the labor force is about 172.6 million strong, instead of a reported 169.6 million at the end of 2024. Edelberg said the newly revised figures should show employment for native-born workers also rose in 2024.

So what are consumers to do? It is really too early to know what the 2025 job market will look like.

Harlan Green © 2025

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

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Q4 Economic Growth Continues

Posted on February 6, 2025 by Popular Economics Weekly

Popular Economics Weekly

Real gross domestic product (GDP) increased at an annual rate of 2.3 percent in the fourth quarter of 2024 (October, November, and December), according to the advance estimate released by the U.S. Bureau of Economic Analysis. In the third quarter, real GDP increased 3.1 percent.

BEA.gov/Q4gdp

Economic growth is still looking good in the fourth quarter of 2024, with real (inflation adjusted) GDP increasing at 2.3 percent. It was mostly due to consumer spending over the holidays that rose 4.2 percent, largely because December retail sales soared, I reported earlier.

Consumers are not quitting their shopping habits, in other words, and it contributes some 70 percent to the GDP, while corporate profits are growing at a multi-decade high, which is why workers are still fully employed.

So, economists are now looking at the New Year predictions for economic growth. The Atlanta Federal Reserve’s GDPNow prediction for Q1 2025 has been all over the place.

It now says real GDP growth is 2.9 percent on February 5, down from 3.9 percent on February 3. “…after recent releases from the Institute for Supply Management, the US Bureau of Economic Analysis, and the US Census Bureau, of lower “first-quarter real personal consumption expenditures growth and real gross private domestic investment growth.”

But inflation is still coming down, a good thing, since the tariffs to come will push prices higher on the taxed imports. It is especially true with the important Personal Consumption Expenditure Index the Fed likes to use to measure inflation.

“The price index for gross domestic purchases increased 2.3 percent in 2024, compared with an increase of 3.3 percent in 2023. The PCE price index increased 2.5 percent, compared with an increase of 3.8 percent. Excluding food and energy prices, the PCE price index increased 2.8 percent, compared with an increase of 4.1 percent.

Why so much fluctuation? It’s because of the presidential election, of course. There is tremendous confusion over what the Trump administration wants for economic growth. Reducing the budget deficit means finding budget cuts, which could slow down more business investment. Especially when Trump wants it to be in more fossil fuel production when we already have a surplus of oil and natural gas.

So in spite of concerns over their jobs that is showing up in consumer sentiment surveys, consumers keep spending according to the University of Michigan survey.

“Consumer sentiment confirmed its early-month reading, rising for the fifth consecutive month and reaching its highest value since April 2024. Buying conditions exhibited a particularly strong 32% improvement, primarily due to a surge in consumers expecting future price increases for large purchases. The expectations index continued the post-election re-calibration that began last month, climbing for Republicans and declining for Democrats in December,” said Survey Director Joanne Hsu.

And what will Friday’s unemployment report look like. MarketWatch’s Jeffry Bartash reports that weekly initial jobless claims are back to normal, with the effect of the LA fires diminished. New jobless claims, a proxy for layoffs, increased by 11,000 to 219,000 in the seven days that ended Feb. 1, the government said, which is in the normal range.

We could still have a very good 2025 year, in other words. Both the service and manufacturing sectors are growing, with manufacturing expanding after a years-long slump.

The Manufacturing PMI® rose to 50.9 percent in January, 1.7 percentage points higher compared to the seasonally adjusted 49.2 percent recorded in December. It was the 57th month of expansion after one month of contraction in April 2020, per Timothy Fiore, Chair of the survey committee.

And lastly, private payrolls company ADP said U.S. businesses created a solid 183,000 new jobs in January, and wages rose 4.8 percent, which showed the labor market was still growing.

This is why financial market indexes are at record levels, despite the looming uncertainties. It looks like some irrational exuberance is motivating investors who rely more on rumors than research, while corporate profits as a percentage of GDP are rising 11 percent these days, according to one analyst, Deutsche Bank strategist Jim Reid, and as cited by MarketWatch’s William Watts.

So irrational exuberance will be the norm this year, which in general means either follow the herd, or hunker down and wait out the chaos.

Harlan Green © 2025

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

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Coup Attempt by Donald Trump-Elon Musk

Posted on February 5, 2025 by Popular Economics Weekly

A couple dozen young men go from government office to government office, dressed in civilian clothes and armed only with zip drives. Using technical jargon and vague references to orders from on high, they gain access to the basic computer systems of the federal government. Having done so, they proceed to grant their Supreme Leader access to information and the power to start and stop all government payments.

That coup is, in fact, happening. And if we do not recognize it for what it is, it could succeed.

In the third decade of the twenty first century, power is more digital than physical. The buildings and the human beings are there to protect the workings of the computers, and thus the workings of the government as a whole, in our case an (in principle) democratic government which is organized and bounded by a notion of individual rights.

The ongoing actions by Musk and his followers are a coup because the individuals seizing power have no right to it. Elon Musk was elected to no office and there is no office that would give him the authority to do what he is doing. It is all illegal. It is also a coup in its intended effects: to undo democratic practice and violate human rights.

Timothy Snyder, Author of On Tyranny

do

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Fewer Jobs Available

Posted on February 4, 2025 by Popular Economics Weekly

Financial FAQs

“It’s gotten harder for the unemployed to find work: Job openings in the U.S. fell at the end of 2024 to the second lowest level since the end of the pandemic.” MarketWatch

FREDjobopenings

Job vacancies reported by the Bureau of Labor Statistics have dropped from 8.2 million to 7.6 million openings in just one month. And this is becoming worrisome with the financial markets’ uncertainty over the effects of the federal government efficiency drive that President Trump is promising.

“It’s also taking people who lose a job a lot longer to find one. The number of people collecting unemployment benefits has risen to the highest level since 2018 if the pandemic years are omitted,” said Marketwatch.

This is having an impact on consumer confidence, needless to say, since consumers tend to become more cautious in their spending ways at such times. The Conference Board’s Confidence survey wasn’t upbeat.

“All five components of the Index deteriorated but consumers’ assessments of the present situation experienced the largest decline. Notably, views of current labor market conditions fell for the first time since September, while assessments of business conditions weakened for the second month in a row,” said its Chief Economist, Dana Peterson.

Why the doubts when the just elected Republicans are touting they can cure the budget deficit with a tariff war, which the Wall Street Journal just headlined was “The Dumbest Trade War in History.”

None of this is supposed to happen under the U.S.-Mexico-Canada trade agreement that Mr. Trump negotiated and signed in his first term, according to WSJ’s Editorial Board.

“The U.S. willingness to ignore its treaty obligations, even with friends, won’t make other countries eager to do deals. Maybe Mr. Trump will claim victory and pull back if he wins some token concessions. But if a North American trade war persists, it will qualify as one of the dumbest in history,” says the WSJ.

Then there are the ongoing deportations which will hurt service industries like leisure, transportation, healthcare, and construction which employ a majority of immigrants, especially in the smaller businesses.

The number of job vacancies reported by companies was lowest after the 2008 Great Recession and began the steady climb to 7 million just before the COVID-19 pandemic 7.6 million job openings has stabilized over the past several months, indicating that the job market and so the unemployment report hasn’t changed. There were 5.5 million hires and 5.3 million separations (i.e., left their jobs), indicating that some 200,000 new jobs were created, which will be confirmed in Friday’s official unemployment report.

All three major stock market indexes have been seesawing since Trump enacted, then suspended the Mexican and Canadian tariffs, but not the Chinese 10% tariff. So, it is really up to the new administration to calm the markets, if they don’t want more investors to head for the exits.

And how will the threatened firing of FBI agents calm the waters? Who will then protect us from domestic and foreign terrorists?

Harlan Green © 2025

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

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The Tariff Wars–Part II

Posted on February 3, 2025 by Popular Economics Weekly

Financial FAQs

“Trump has called “tariff” the fourth most beautiful word in the dictionary behind “God”, “love” and “religion.” CNN

FREDdebt/GDP

On Saturday, President Trump, just 11 days into his second term, said he will impose a 25 percent tariff on Canadian and Mexican imports, and 10 percent on Chinese imports.

He has said it will raise revenue to correct the large trade imbalances with those countries, as well as induce Mexico and Canada to halt the flow of fentanyl into the U.S., as well as illegal immigration.

But immigration flows are already down to levels before even the Obama administration, while Mexico and Canada have already said they will work with Trump to stem the flow of illegal drugs.

So why is he doing what will badly harm the U.S. economy and that of our two best neighbors and trading partners? His real motivation is pure greed. He and his oligarch friends must decrease the massive budget deficit that has mushroomed to 121 percent of Gross Domestic Product (see graph), so that he can prolong the tax cuts that have transferred so much wealth from working adults to his wealthiest supporters and added $5 trillion to the national debt.

He must cut the huge budget deficit that has resulted because it is alarming bond investors and budget hawks.

Hedge fund manager Ray Dalio, founder of Bridgewater Associates, once the world’s largest hedge fund, has been sounding the alarm mostly recently in a Barron’s Magazine interview, in which he said our current budget deficit could give the world a “financial heart attack.”

“Think of the credit flow like the blood flow that carries nutrients through the system to the body. Credit creates debt that builds up like plaque in those arteries, and like plaque, it grows and crowds out the nutrients because debt service crowds out other spending,” , said Dalio

“When does the heart attack come? When the constriction is enough that it squeezes out other spending, which in increasingly happening, or when investors see that happening, which leads them to sell bonds,” said Dalio.

Tariffs had become Trump’s way of paying down the deficit by taxing imports. He has said collecting what he believes will be “billions” in taxes from the tariffs on imports will help pay down the huge budget deficit that he helped to generate from the 2017 tax cut bill (Tax Cuts and Jobs Act) in his first term.

But that tax cut was just the latest by Republican administrations that have caused the massive national debt, which is expressed as a ratio of debt-to-gdp in the above FRED graph dating from 1980, when Republicans first began increasing the budget deficit.

It has been Republicans’ huge tax cuts since President Reagan in 1980 that have created the largest national debt since World War Two, and the trickle-down economy ever since. And renewing Trump’s 2007 Tax Cuts and Jobs Act when it expires this year could add another $5 trillion to the budget deficit, according to non-partisan analysts.

So who will be hurt most by the tariffs? Workers in all countries at a time when inflation is still too high, and preventing the Fed from making fewer rate cuts this year due to higher inflation.

The NAFTA trade agree between Mexico and Canada has made North America the largest trade-free zone outside of the Eurozone, enabling each country to produce what it does best, such as autos where many auto parts are manufactured more cheaply and shipped into the U.S. where they are assembled.

Trump has repeatedly (and incorrectly) said that “the tariff sheriff” former President William McKinley, ushered in an era of American prosperity at the end of the 19th century by going all-in in tariffs, as cited by CNN.

No, it was the result of the industries created in the first Gilded Age by the Robber Barons of that era—the oil, railroad, and banking magnates of that era. And Trump, a convicted felon, believes he can become another Robber Baron in this Gilded Age.

Harlan Green © 2025

Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen

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