Trump critics say he’s amplifying that trend. “Tax cuts only work if you believe in trickle-down economics,’’ says Rakeen Mabud of the Roosevelt Institute, a Treasury official under the Obama administration. “At least 30 years of data shows that it’s more of a trick.’’
But the critics are split over what exactly is wrong with the Trump deficits. Most economists say that so much red ink is dangerous in itself, likely to trigger higher inflation and interest rates. An opposing school argues that there’s room to deficit-spend -– it’s just that Trump is doing it in the wrong places, doling out cash to the Pentagon and tax breaks for the wealthy. Expensive programs like universal public health care are winning support among Democrats with an eye on 2020.
The president, whose approval rating remains stuck around 40 percent, will trounce any challenger in two years’ time “if the economy is anywhere close to where it is now,’’ says Stephen Moore, an adviser to Trump in 2016 and co-author of the recent book “Trumponomics.’’ But he acknowledges that there’s an experimental side to what Trump is doing.
“We’re really putting supply-side economics on the line here,’’ says Moore. “If this doesn’t work, we’re going to have to eat some crow.’’
This article was provided by Bloomberg News.