AILSA CHANG, HOST:
All right. Let’s talk more about Trump’s latest tweets about China and the Federal Reserve chairman in our regular Week in Politics segment. We’re joined now by E.J. Dionne of The Washington Post and Georgetown’s McCourt School, and Hugo Gurdon of the Washington Examiner.
Welcome to both of you.
HUGO GURDON: Hi. Thanks for having us.
E J DIONNE: Good to be with you.
CHANG: So today, as we just heard from Jim Zarroli, we saw the president tweet, who is our bigger enemy, Jay Powell or Chairman Xi? This is pretty incredible criticism for a president to unleash on the Fed chairman. And I just want to get a sense from both of you, how worried do you think President Trump is about a recession? Hugo, let’s start with you.
GURDON: I think that the White House and the president in particular is really quite worried. the trend of growth has – is going down from 3% annual growth to 2% annual growth. And his tariffs are blamed by many economists for that effect, which is why people are talking about the possibility of tax cuts, which is why the stock market lurches downwards. You know, what – the economy is his strongest card in his efforts to win reelection in 2020.
CHANG: I mean, he’s pegged his whole presidency on the health of the economy.
GURDON: He has; he’s talked about the boom. He’s taken credit for that. And obviously that means that, as all presidents are, he would take the blame if it goes down. And the stock market is a six-month leading indicator, which suggests that, early in next year, there’s going to be lurches downwards because of exactly what’s happening now.
DIONNE: I think he’s petrified because he’s got very low approval ratings anyway, and imagine how low they could go if he didn’t have a good economy. I mean, there was something crazy about the tweeting today. To compare one of your own appointees to China’s dictator and call him an enemy would be shocking if we could be shocked by Trump anymore.
And that other part of that tweet storm – ordering American companies to immediately start looking for alternatives to China – imagine if Barack Obama had said something like that. You’ve got Republicans comparing Democrats to socialists. Here you have this tweet from the president that Republicans would say with a Democratic president, he’s acting like Joe Stalin. I’m very curious to ask Hugo, what are Republicans going to say about a statement like that, which – any advocate of – even moderate friends of the free market economy had to be shocked by that.
GURDON: Well, they’re going to be – I mean, look. There will be a range of responses to that. I think one of the responses will probably be absolute silence. I think that most people…
GURDON: …Will see that as simply a tantrum. I mean, there was a comment earlier on where someone said, you know, they’re just turning the economy into a command economy. I don’t think it’s doing anything to the economy – might be damaging it a bit, but it isn’t changing the economy because he doesn’t have the power to do this.
The president often will say things, I think, through ignorance and clumsiness rather than through design that, you know – that he will do X or he’ll do Y which completely exceed his authority to act. This isn’t – these – the companies are not going to have to follow his orders. They’ll say, sorry, you don’t have the authority to do that. We’ll continue to conduct our business as we see fit.
CHANG: And, of course, all of this as the president’s heading to Europe for the G-7 meeting. Now, I want to touch on some back-and-forth this week. We saw the president go back-and-forth this week on whether he’d ask Congress to cut payroll taxes for American workers. He also went back-and-forth on background checks for gun purchases. What are Republicans in Congress making of these mixed signals, do you think, Hugo?
GURDON: Well, they certainly are mixed signals. And I think that they – the thing that they actually tell you is that the president doesn’t know yet what he wants to do about those things. He talked about payroll taxes, and I don’t think that that will be where a cut comes if there is.
Larry Kudlow, his economic adviser, was talking, I think, earlier today or yesterday about the possibility of taking up a plan that Rick Scott – Senator Rick Scott of Florida – put forward, which was really kind of interesting. What he talked about was a middle-class tax cut which would be of the same size – that would compensate for the amount of extra money people are paying in prices because of tariffs. And the interesting thing about that is not just that it would be a stimulation for the economy, it’s also – conceivably, it could make the tariffs less unpopular heading into the election year if they’re compensated for by tax cuts.
CHANG: What do you think, E.J.? If you’re a lawmaker on the Hill right now, like, trying to divine any sort of guidance from what the president has been saying this week, where would your brain be?
DIONNE: My first – the first place it would be…
DIONNE: …Is wondering, where is this Republican concern about deficits? The deficit is approaching a trillion dollars. I mean, we – the Republicans, when Democrats are in power, say this is a terrible thing. They’ve cut taxes. They put us in a situation – us, the country – in a situation where the only way to stimulate the economy is to add further to this thing, and the other – which is why the president goes back-and-forth on whether to do this.
But the other striking thing that we saw is whenever President Trump approaches challenging Republican orthodoxy – except on trade – he immediately backs away. And that’s where the backing away on guns is concerned. He rhetorically likes to challenge Republican orthodoxy and sound like a populist. And then he just says, no, I’m going back to where the rest of the party is.
This is a scary time. I mean, they are – the new manufacturing index shows that manufacturing is contracting here for the first time since September 2009. It’s in trouble in Japan and Germany. That’s why the G-7 is so important, and that could be a catastrophe too.
CHANG: I also want to touch on some pretty controversial remarks the president made about Jews who vote for Democrats. Let’s give a lesson.
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PRESIDENT DONALD TRUMP: In my opinion, you vote for a Democrat, you’re being very disloyal to Jewish people. And you’re being very disloyal to Israel. And only weak people would say anything other than that.
CHANG: E.J., let’s start with you. Who do you think the president’s playing to?
DIONNE: I don’t really know because that is, in some deep way, a classic anti-Semitic trope ironically. Obviously, he – I guess he thinks he’s playing to more conservative Jews who support Prime Minister Netanyahu. But to call – it’s got dual loyalty beneath it, and he’s made other comments like that. So I don’t know if there is a subliminal message there or not, but it’s very scary when a president starts talking like that.
GURDON: Yeah. I don’t think that – I think this is another example of where the president blunders into sensitive issues which he doesn’t understand. You know, I don’t think that this is some sort of dog whistle to the far-right extremists. What he’s saying is, hey, I’ve moved the embassy to Jerusalem. I’ve recognized Jerusalem as the capital. I’m a great friend of Israel. Jews should vote for me. That’s really what he’s doing. He does it in a way which perhaps ensures they won’t by using this old trope of disloyalty. So he may be very, very ineffective. But I think that that’s really what he’s trying to do.
CHANG: And we’ll have to leave it there. That’s Hugo Gurdon of the Washington Examiner and E.J. Dionne of The Washington Post and Brookings Institution.
Thanks to both of you.
GURDON: Thank you.
DIONNE: Thank you.
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