by Jack Rieger
Unless you’ve been living under a rock for the past year, you’re probably aware of Donald Trump’s ascension as a legitimate candidate for the presidency of the United States.
Say what you want about Trump, but the man is polarizing; you either love him or you hate him. He’s dominated family dinner conversations across America for over a year, and it’s not your typical well-behaved discussion. Trump’s ideas are evoking emotion from people who aren’t typically interested in politics. Your uncle loves his willingness to “say what everyone is thinking” and your mom thinks he’s Hitler reincarnated. University of Nevada, Reno political science professor Kevin Banda, who specializes in public opinion and campaigns, put it simply.
“He’s interesting. He gets people’s attention.”
But for all the attention Trump has received, is anyone actually aware of his policies? Trump supporters are refreshed by his apparent honesty and disregard for political correctness. His adversaries are offended by his disrespect toward minority groups and anyone who’s against him. But what is his economic strategy? What are his thoughts on free trade? How does he plan to combat ISIS? Are any of his ideas feasible?
About a month ago, a friend of mine who supports Trump encouraged me to research his policies. “Go read his policies, I think you would like them.” So I did, with the goal of objectively understanding his ideas better. But I’m not going to pretend I’m smart enough to understand each one of his suggestions, what sort of impact they will have on the country and whether or not they’re realistic.
Conveniently, I live less than a mile away from a tier one university filled with experts in all the fields that have to do with Trump’s policies. Who better to ask about those ideas and potential policy changes than the people who have spent their adult lives studying and researching those industries?
My goal was to remain unemotional and totally objective so that the only opinions I wrote down were quotes spoken from professors who have the educational backbone to be opinionated.
I’ve broken down Trump’s policies and potential impact on the United States into four sections: the US economy, international trade, politics and ISIS.
The United States Economy
Before diving into Trump’s proposed economic policies, I want to address a popular question: does Trump’s business acumen qualify him to understand and manage the economy? He’s built casinos, golf courses, hotels and other properties. He attended the Wharton School of Business, one of the best business schools in the world, and is worth a reported $4.5 billion.
But does owning businesses qualify Trump to understand and manipulate the economy? I asked the same question to University of Nevada professor Federico Guerrero, who earned a Ph.D. in economics from the University of Maryland.
“The ability to be a good policy maker and the ability to run a business may have some elements in common, but in the macro economy, it basically has zero correlation between one and the other,” Guerrero said.
“Let me give you an example of the fallacy that the country can be run like an enterprise, like a company. If a company goes through trouble, what does the manager need to do? Basically go through restructuring. Slash costs, lay people off, reduce salaries and so on. When the economy is in recession, which is equivalent to a company running into trouble, the government has to do the opposite of that because when the economy is in a recession the private sector is in the mood for spending less. But any person’s expenditures are another person’s income, so if we ask the government to act like a corporation and tighten the belt, the only thing it will do is deepen the recession. The economy doesn’t run on profitability, it runs on GDP and jobs, and applying the same principles is a killer. By forcing the government to balance the budget during a recession the only thing you’re doing is deepening the problem.”
Professor Rahul Bhargava, who earned a Ph.D. in finance from Texas A&M, reiterated how different a business and an economy are in nature.
“As a firm you can file for bankruptcy, and a lot of Trump’s firms have filed for bankruptcy, and he can start over again,” Bhargava said. “A country can’t start over again. We can’t just say ok we’re 80 trillion in debt, let’s file for bankruptcy and start from scratch. Governments are not profit driven, firms are profit driven. Managing those two are very different.”
So maybe a business and the US economy aren’t quite the same, but people have held positions in office without political experience before. Ronald Reagan was an actor before he was elected governor of California. Arnold Schwarzenegger was a weightlifter, actor and businessman before being elected to the same position. There isn’t a cookie cutter career path to managing an economy, in fact politicians are typically looked down upon for spending their careers in politics. That being said, let’s look at Trump’s economic policies.
Trump has three primary areas of interest regarding the US economy: lower national debt, lower the corporate tax rate and lower the income tax rate. He also has some policies outside of economics, like immigration, that will also have an economic impact.
Let’s begin with national debt, which is something most conservatives are uncomfortable with and have addressed during their campaigns. The United State’s national debt currently stands at about $19.2 trillion, a figure that has risen by $8.5 trillion since Obama took office. But what is the issue with national debt? Why does it hurt the United States economy?
“Long term, the danger is people will not want treasury bonds,”Bhargava said. “And if they start to sell treasury bonds interest rates will go up, and if interest rates go up we’ll get into a recession. So if foreigners hold our treasury bond, which is the debt, that’s the risk. If we own it our self, then really foreign powers can’t do anything to us.”
So do investors still have confidence in United States? Is the US at an unsafe level of debt?
“People have confidence in the US dollar,” Bhargava said. “As long as people have faith in the US dollar, it really won’t make any difference. And the US has the assets and natural resources so that we can support this level of debt. We are a huge country. We’ve got huge resources. We’ve got huge technology. I don’t see it as that big of a problem. As long as our GDP grows we are fine.”
Professor Federico Guerrero, who earned a PHD in economics from the University of Maryland, went as far to say that debt is a necessary evil for a growing economy.
“As long as the debt grows slower than GDP, it is not only good, but absolutely necessary to have increasing debt,” Guerrero said. “What we cannot do is go to ratios of debt to GDP that are enormous.”
Guerrero also mentioned that as long as the United States is using debt to become more productive, it is well worth it.
“We simply have to analyze what do we take debt for, what is the cost of that debt, and what are the benefits of that debt,”Guerrero said. “When President Eisenhower decided to create the system of national highways, the US had a ratio of national debt to GDP of 130 percent of GDP; higher than today. Instead of President Eisenhower saying we are too much into debt and we shouldn’t do this, he challenged Americans by saying we are Americans, we are going to do this because it’s in the benefit of our country, and the benefits that come with this project far outweigh the interest payments that this project will require, so we’ll simply do it. And if we analyze the thing in retrospect, after he did that we had a long period of growth that was much faster than the interest payments. As a consequence, the share of debt to GDP declined.”
Trump’s second economic policy is to lower the corporate tax rate (the tax rate businesses pay) from approximately 40 percent to 15 percent. Trump claims this will discourage US businesses from taking their operations out of the country in order to avoid high corporate tax. Trump also claims this will provide significant GDP growth and better wages for workers. Professor Bhargava was skeptical about how realistic that plan is and the effect it would have on national debt.
“If you lower the taxes then you have to lower [government] spending,” Bhargava said. “That’s going to lower your revenues a lot. What programs are you going to cut? People complain about certain programs, but if you look at the dollar amount as a percentage of the US budget, they’re not that big. Are you going to cut military, education, social security? I don’t think it’s feasible, we don’t have that much room in spending.”
Guerrero reiterated his colleague’s point about how realistic a 15 percent corporate tax would be.
“If you lower corporate tax you’re going to be losing budget revenues,” Guerrero said. “Reducing the corporate tax rate dramatically requires either an increase in revenues in some other way or a significant reduction in expenses. I couldn’t agree with his proposal the way it seems to be now.”
Trump’s final economic policy is a new income tax plan composed of four brackets that eliminate the marriage penalty. Trump has stated that he believes income tax is too high and it’s suppressing individuals and the country as a whole from growing.
Trump’s lowest rate is 0 percent, offered to single individuals earning less than $25,000 and married couples making less than $50,000. Those two groups make up over 73 million households. The highest income rate is 25 percent, paid by single individuals making more than $150,000 and married couples making over $300,000.
Professor Bhargava wasn’t concerned with the removal of income tax for lower income earners, but was concerned with a 25 percent rate for high-income earners.
“At the low end, the tax collection from that group of individuals [the 0 percent bracket] is not that high anyway,” said Bhargava. “What about people that are making 200 to 300 million a year? Do we still tax them at 25 percent? That’s something that would start to make a difference. Your collections will go down. Until you cut spending, there are only two choices governments have: raise taxes or print money. Printing money is inflation and that hurts everyone. Raising taxes in a particular bracket only hurts that group.”
Professor Guerrero repeated Bhargava’s concerns about a decrease in budget revenues, but unlike Bhargava, Guerrero was concerned with lower income earners not paying income tax.
“From the fiscal point of view we’re going to lose revenue,” Guerrero said. “The budget deficit is going to be bigger than it is now, meaning the debt is going to grow faster, which is self-defeating. The other thing that worries me is by making two out of eight groups not pay a penny will only enforce the idea that taxes are for some, but not for all. That’s the most important source of a tax, that we feel the burden is on all of us not some of us.”
Professor Guerrero also pointed out that lowering tax rates doesn’t necessarily mean the economy will grow.
“When the marginal rate of taxation was 91 percent under Eisenhower, the economy did not stagnate at all,”Guerrero said. “There’s no simple correlation between marginal tax rate and economic growth.”
Both Bhargava and Guerrero feel Trump’s income tax plan will vastly reduce tax revenues and increase national debt, which is interesting because Trump has made decreasing national debt a main priority. Professor Guerrero also mentioned there is no correlation between lower income taxes and economic growth, although Trump feels otherwise.
Immigration has obviously been a focal point for Trump during his campaign and while it doesn’t fall under his economic policy, it will have economic implications. Trump plans to strengthen immigration laws, return immigrants that have committed crimes to their native countries, and end birthright citizenship. Birthright citizenship allows illegal immigrants who were born in the US to be citizens. The Pew Hispanic Center estimates that 7.5 percent (about 300,000 births per year) of all births in the US are to unauthorized immigrants. The obvious question is what would be the effect of instituting Trump’s plan of revoking the citizenship of those births and strengthening immigration laws in general?
“Stopping immigration, that would be devastating because we do want the best brains in this country,” Barghava said. “The one I bring up because everyone knows is Elon Musk. He’s South African. We wouldn’t have Tesla without him; we wouldn’t have SpaceX without him. Do you really want to shut out the brains of the world?
That’s what the US is built on. Either you produce your own talent, or you import the best talent in the world. The US has been very good, since WWII, at getting the best talent from the world. Because if you think about it, the people that immigrated here early in the 1900s, they came by ship. There was no going back to their families ever, so they were extremely risk taking, driven, motivated people. So most immigrants that come, they are extremely hungry, hard working, motivated people.”
Professor Guerrero hit on the trade relationship between the US and Mexico, and the potential harm eliminating immigration would cause.
“Mexico is our third largest trading partner behind Canada and China,” Guerrero said. “You’re cutting off the flow of workers. For many of the jobs like picking fruit and gardening and construction work and so on, we will be deprived of a significant number of workers. That means wages will have to go up to persuade American born citizens to do those jobs. This is assuming it works. If it’s effective it should benefit blue-collar workers by raising the wage. Labor economists don’t agree for the most part that it will work. Cutting off trade is seldom a good idea.”
Trump has made it very clear whom the enemy is when it comes to international trade: China. He claims China is undervaluing their currency by up to 40 percent, which incentivizes other countries, including the US, to buy Chinese products. If people are buying from China instead of the US that means the US is losing out on potential revenue, jobs and growth.
Is the Chinese yen really undervalued by 40 percent?
“It’s undervalued,” Guerrero said. “I think the quantitative amount is overstated. I don’t think it’s between 15 and 40 percent. I think I have to agree qualitatively, China has undervalued its currency, but keep it mind so have other successful countries in the world before when they move from either lower income to middle income or middle income to high income.”
Including the United States.
“That’s the way that the US did it under Alexander Hamilton’s leadership,” Guerrero said. “Basically a combination of a weak dollar and some tariffs to protect domestic producers from competition from abroad, which at the time, implied more advancement in places like Britain and France. I don’t think China is doing anything different than other countries have done before. Are they to blame? Maybe, but not very differently than Japan or the US before China. It’s nothing new.”
Trump has said he will “bring China to the negotiating table,” in order to arrange better trade terms. Assuming Guerrero is correct regarding China’s currency being undervalued, can Donald Trump force China to appreciate its currency?
“You can’t force a government to do anything,” says Bhargava.
While Guerrero confirms that China’s currency is indeed undervalued, how big of a problem is that for the United States, whose third largest trade partner is the Chinese?
“It’s not really a huge problem [China’s undervalued currency] because if they do let it [the Yen] float the consequences would be worse,” Bhargava said. “Because what that’s going to do is it makes Chinese imports more expensive here and it will lead to inflation in the US. For jobs to shift, that doesn’t happen overnight, whereas markets react to currency overnight. Yes if there were some potential jobs that would move from China, firstly they wouldn’t move to the US. There are a lot of other low cost producers between China and the US. So let’s say production cost in China is 10 and in the US it’s 20, there’s a bunch of countries between 10 and 20; Vietnam for example. So yes, some of them might move out of China if their currency gets stronger, but that doesn’t mean it’s going to come back to the US.”
Another problem Trump has with China’s economy is the supposed unfair government subsidies and lax labor laws Chinese companies are benefiting from. On his website, Trump states “No more sweatshops or pollution havens stealing jobs from American workers.” But does Trump, as the hypothetical president of the United States, have the ability to change another country’s laws?
“No that’s an internal policy issue, there’s nothing he can do about it,” Bhargava said. “We give farming subsidies to farmers. How could China tell us what to do about it? There’s nothing he can do.”
Guerrero echoed the same sentiment.
“The problem is China is at a different level of development than the US is now and the advanced world is now,” Guerrero said. “It’s very difficult to do. It’s very difficult to impose on China the labor and environmental standards of advanced countries. We also had child labor in the US long ago. Through a process of legal changes, institutional changes and cultural changes, eventually that came to a stop. But could it be stopped overnight by some enlightened politician? For example Hamilton was against slavery, among the few founding fathers that was. Could Alexander Hamilton, enlightened as he was, eliminate that practice? I don’t think so because it was so engrained. Culture needs to change. Economic, cultural and social changes need to go along with geopolitics.”
So while Trump identifies the US’s trade relationship with China as unfair, according to two international trade experts, he hasn’t put forth a legal solution.
Before looking at Trump’s potential impact on Congress and the political landscape, it’s important to understand his current position in the race for the Republican nomination. Trump leads Ted Cruz in delegates 845 to 559 as of April 24. In order to earn the nomination, Trump needs to reach 1,237 delegates and there are 733 still available. How likely is it that Trump will reach that number? And if he doesn’t reach that number, then what happens?
“It’s not clear to me that he is going to outright win the nomination because you have to get 1,237 number of delegates, and he might not get it,” says Kevin Banda, a political science professor who studies public opinion and elections. “And if he doesn’t get it, they’ll [the Republican party] have to go through multiple rounds of voting, assuming they don’t change any rules. And once they start doing that, depending on the state that the delegate is from, at some point in the process, they’re allowed to vote for whoever they want.”
If Trump doesn’t reach 1,237 votes, the Republican Party can basically vote for whomever they want. But why wouldn’t they vote for Trump considering he’s the most popular candidate?
“They know that he’s likely to drag the republican side of the ticket down the ballot. So members of the house, members of the senate, state legislators, governors anyone else who’s running as a republican is likely to get harmed by Trump’s presence on the ballot,” Banda said. “They don’t like what he says, they don’t like how he says it. They’re worried about the potential long term damage that might occur if he actually ends up being the nominee which is probably why he won’t end up being the nominee.”
This November, 469 seats are up for election in the US congress. Congress is currently controlled by the Republican Party, but experts are predicting Democrats will regain control after this midterm election. Professor Banda believes Donald Trump could actually assist Democrats in that takeover.
“Presidential candidates affect everything below them in their own party,” Banda said. “If your nominee is popular that helps. If your nominee is unpopular that hurts everybody in terms of the number of votes they get. A lot of that is based on how people view the incumbent. At this point I think it’s fair to say Obama is probably going to have at least a slightly positive image around Election Day, which is going to help the democrats. And you’re going to contrast that with Trump’s image, which is incredibly negative among everybody except the people who vote for him, which are not a large group of people. People think he’s racist, people think he’s sexist, people think he’s a jerk; a generally unpleasant person. They don’t like him. His presence on the ticket will almost certainly harm the Republican Party in those lower level elections.”
Let’s assume Democrats take over congress, which is what experts are predicting, and Donald Trump is elected president. How would that affect legislation?
“If he wins and there is a democratic congress, they’re not going to do anything for him,” Banda said. “They’re not going to work with him. Maybe the more interesting question is if there’s a republican congress will they work with him, and my answer to that is probably not very much because they don’t really like him. Their predominant worry is that he’s going to hurt them.”
According to Banda, Trump’s presence in the white house would handcuff legislation regardless of which party controls congress. Trump’s association with the Republican Party will also supposedly help the Democrats capture more seats. Does Trump have any positive impact on politics?
“More people are paying attention,”Banda said. “I don’t know if they’re paying attention for the right reasons, but they’re paying attention.”
According to Quartz, an online news outlet, the subject of ISIS was the second most popular debate topic during the presidential primary debates. It’s a subject the American people seem to have a vested interest in, and Donald Trump is no exception.
But before we get into Trump’s plans to combat the threat of ISIS, it’s important to understand the United States’ relationship with the Middle East, specifically Iraq and Syria. I asked Dr. Robert Ostergard, a political science professor who has taught several classes in terrorism and political violence, why is the US in Iraq?
“Our basis for being there [Iraq] is to make sure they don’t have an Islamic government come to power and to make sure the region is stable,” Dr. Ostergard said. “So our role in Iraq is to create stability in order to keep the problems in Iraq from overflowing into other areas.”
The US has a similar motive for being in Syria.
“Our role generally has been to try to replace the Assad Regime in Syria with a democratic government,”Dr. Ostergard said. “It is a big mess right now. It [Syrian government] is corrupt, abusive. It’s a government that has never supported US interests in the Middle East.”
The US invaded Iraq in March of 2003. How does an expert in international relations and terrorism grade that decision 13 years later?
“[It was] the worst foreign policy mistake ever made in US history,” Dr. Ostergard said. “We took what was a brutal dictatorship and destabilized the entire country to the point where nobody was able to get any firm control. So the United States ended up staying in there for more than a decade at a cost of close to two trillion dollars. No matter how many dollars we put into rebuilding the Iraqi army, the society is so divided that even the Iraqi army fell apart. It’s a war that never should’ve started, it’s a war that we had no basis to start and it’s a war that helped to destabilize an entire region.”
The US intervened in Syria much more recently — around September of 2014. According to Ostergard, the outcome of that intervention has been just as disastrous.
“It’s expanded the civil war inside of Syria and has helped to create the migration problem inside of Syria,”Dr. Ostergard said. “So you’ve got hundreds of thousands of people fleeing Syria because their homes have been destroyed, they have nowhere to go. Their government is essentially pushing them out. This looks more and more like a losing proposition for the United States.”
How does ISIS work into all of this? ISIS was formed in 1999, but didn’t rise to power until the US invaded Iraq in 2003. Very simply, ISIS, or the Islamic State of Iraq and Syria, is a Salafi jihadist militant group that follows a very extreme version of Sunni Islam that promotes violence. The group has control over large amounts of Iraq and Syria, and the CIA estimates ISIS has around 31,000 fighters.
ISIS has conducted or inspired over 70 terrorist attacks in 20 countries, not including Syria and Iraq, according to CNN.com. Those attacks include the San Bernardino incident in December, when a married couple killed 14 people. It also includes the Paris shootings in November, when 130 people were killed by shootings and bombings. And most recently in Brussels, where 32 people were killed by suicide bombers at a metro station and an airport.
While there seems to be no obvious signs of a slowdown, Dr. Ostergard claims that ISIS has lost resources in the past six months to a year.
“All the journals and reports that I read say they [ISIS] have lost territory and are losing some power,” Ostergard said.
ISIS’s primary source of revenue is exporting oil. Analysts estimate ISIS earns roughly 1 to3 million dollars in oil revenue per day by selling to black markets in Turkey. Here lies Trump’s plan to defeat ISIS. “Bomb the hell out of them. Take back the oil,”Trump said to Bill O’ Reilly in June of last year. The United States military is currently bombing oil fields in Syria, but Trump has suggested that the US needs to increase airstrikes.
Would that work?
“You can’t win a war simply by airpower,” Dr. Ostergard said. “There’s no war that I know of that we’ve simply won by airpower.”
Trump has also said that he would “take out” terrorist families in an effort to suppress ISIS, something that is illegal under military law.
“It’s one of the stupidest things that could ever be said in regards to US foreign policy,” Dr. Ostergard said. “Here’s what that does: it incentivizes retaliation. If you go ahead and hold terrorist families responsible for actions of another person, then you’re holding people that might not even know what’s going on responsible. But you’re also engaging in a cycle of terrorism as well. If you meet terrorism with that level of force and that level of indiscriminate force, then all you’re doing is promoting another cycle or generation of people who want revenge on you.”
In March of this year, Trump said the US has “no choice” but to send 20,000 to 30,000 combat troops to the Middle East to fight ISIS. Dr. Ostergard claims that might not be enough troops and the proposition of identifying terrorists is more complicated than it seems.
“It’s underfunding and it’s also engaging in warfare where you don’t even know who exactly your enemy is,” Dr. Ostergard said. “The French tried this in Algeria for years and the French ended up losing with their tails between their legs. The Algerians basically melded together and they couldn’t figure out who the terrorists were. If there is anything to be learned from the Algerian experience, it’s that the use of greater and greater force is just going to build up the resistance even more. You can’t take a repressed people and repress them even more and expect to get a better result.”
In fairness to Trump, the US has attempted to do what he’s suggesting: deploy troops with the mission being to fight ISIS. The results just haven’t been effective.
“We’ve killed more innocent people than we have terrorists,” Dr. Ostergard said. “We’ve bombed out wedding parties, birthday parties and entire building complexes. By all accounts, we are guilty of war crimes because these people are non-combatants, they’re innocent civilians who have been killed by what has turned from targeted bombing to more indiscriminate bombing because of bad intelligence.”
To recap, Dr. Ostergard thinks Trump’s idea of increasing air strikes will lead to the killing of more innocent people and will ultimately be ineffective. With regards to killing ISIS family members, Ostergard thinks that will incentivize retaliation and create a cycle of terror. And lastly, he thinks 20,000 to 30,000 combat troops won’t be enough soldiers and the US will have a hard time identifying who the enemy is.
There are a couple of commonalities among all of Trump’s potential policy changes: he provides simple answers to really complicated, multi-layered issues. For example, he proposes to build a wall in order to secure the border. He says he can bring China to the negotiating table in order to give the US a better trade relationship, and he’ll lower the income and corporate tax rate in order to improve the economy. He claims the way to end ISIS is to increase air strikes on their oil fields and to kill their families. But according to academic professionals in all of those industries, complicated issues demand an answer that doesn’t fit in a 30 second sound byte.
Another common thread in Trump’s narrative is that he’s very good at creating an enemy. He blames Mexicans and Chinese for the loss of jobs and supposed increase in crime. He blames Obama for the United States’ national debt. He blames Muslims for international violence. Professor Jennifer Ring, who specializes in political theory, also claims Trump makes the enemy very obvious.
“Trump says it’s really simple,” Ring said. “Those are the bad guys, we’re the good guys, we’re Americans, we’re going to make America great again.”
And lastly, Trump evokes fear better than any other candidate, whether it is in regards to ISIS, immigration or the economy. But according to Professor Bhargava, America is still a world leader.
“I don’t really understand when he says America is not great, we are great. We have the lowest unemployment in the world. Look at the Eurozone; it’s over 10 percent. Certain countries like Greece and Spain it’s over 30 to 40 percent. So I have no idea what he’s saying when he says we’re not great. We’re great by far. In innovation we’re the greatest. In terms of jobs we’re the greatest. If you look at household income we’re at 45,000. Next is Australia at 35,000. We’re 20 percent higher than the next guy.”
Everyone has their own way of deciding how they vote for a candidate. Some people value leadership skills over policy or experience, and appreciate Trump’s willingness to speak his mind. My goal was to remove emotion and simply become more aware of Trump’s policies and the implications of those policies on the US; to allow facts and educated analysis enhance my opinion.
Next time you find yourself in the middle of a heated debate about Donald Trump, try asking the opposition about his policies. Debate is much more productive and civil when the topic you’re debating is based in fact. As the author Arnold Glasow put it, “The fewer the facts, the stronger the opinion.”
Jack Rieger can be reached at email@example.com and on Twitter @JackRieger.