This week, the Trump administration revealed that it is considering measures to shore up flagging economic growth amid deteriorating global conditions. But insofar as the US economy is vulnerable, Trump himself is largely to blame.
In this Big Picture, Robert Barro of Harvard University observes that the uncertainty stemming from Trump’s trade policies has offset the benefits of otherwise favorable economic conditions. Nobel laureate economist Joseph E. Stiglitz agrees that the US economy should still be booming, but traces the problem to the Trump administration’s demand-sapping handouts for corporations and the wealthy. And UC Berkeley’s Laura Tyson and Lenny Mendonca, an adviser to McKinsey Global Institute, point out that even when US growth was strengthening, most workers weren’t seeing the gains.
Meanwhile, Chatham House’s Jim O'Neill warns that the US economy has reached a point where it will suffer from tightening global financial conditions without reaping any benefits from financial loosening. Worse, notes NYU’s Nouriel Roubini, both the US and the global economy are now at risk of permanent negative supply shocks from the Sino-American conflicts.