The Bush-Trump similarity holds for trade deficits as well. Bush saw the trade deficit grow from $375 billion in 2001 to $619 billion in 2004 (and peaking at $771 billion in 2006). From the start, Trump pledged to implement a trade strategy that favors U.S. exporters over importers, thus improving the trade deficit.

So far, that policy is not working out too well. Since 2016, the trade deficit for goods and services has steadily risen from $521 billion to $625 billion in 2018, with an $891.1 billion gap for goods only, an all-time record. The trade deficit for 2019 is expected to be even higher. It seems that Trump’s anti-free trade policy has performed no better than Bush’s free-trade policy when it comes to the trade deficit.

Deregulation

Is deregulation under Trump buoying the economy? The conservative American Council for Capital Formation did note that, “The flow of new regulations under the Donald Trump administration has been much smaller than observed during the Barack Obama and George W. Bush administrations.”

The group also noted that deregulation would be going faster at the administration’s two-year mark, were it not for the slowdowns in the courts.

Trump boasted that his administration is eliminating 22 regulations for every new one. The credibility of that claim aside, it is not the number of regulations removed that is the best measure of the effectiveness of deregulation. It is whether the process is successful in balancing costs and benefits. Wise or not, the stock market seems to have welcomed the prospects of a less regulated economy, despite the possible negative consequences for the environment and financial risk

There are longer-term concerns. The Washington Post noted the rise of risky leveraged lending: “Financial companies issued a total of $1.271 trillion in leveraged loans in 2017 and 2018, 40 percent more than in 2015 and 2016, according to S&P Global Market Intelligence. More than 80 percent of the loans made in 2018 were made with fewer restrictions on the borrower and fewer protections for the lender in the event the loan falls into default.”

Financial risk may also be creeping in at the ground level with the administration’s weakening of the Consumer Financial Protection Bureau. There has been an 80 percent drop in enforcement actions from the peak in 2015 to 2018 (while monetary relief for consumers fell by 96 percent per case) amid rising consumer complaints regarding credit cards and student loans. There have also been recent efforts to roll back restrictions on payday lenders.

The CFPB had been established under Dodd-Frank for the purpose of reducing predatory practices that contributed to the 2008-09 financial crisis.

What Comes Next?