President Donald Trump is thrilled with the stock market. Trump marvels at the sustained rise of equity prices in public appearances and tweets, marshaling it as evidence that “we’re doing tremendously well” and there’s “no WH chaos!” Yes, the story is more complicated than that, but this is a standard politician’s tack: Find something that’s going well, and hint oh-so-subtly that it’s going well because of you. Trump’s ballyhooing of stocks, while not objectionable, does track with an important, budding political development: the fading of his populism.
“Populist,” admittedly, was always a strange label for a man who proudly uses a gold-plated commode. But Trump campaigned like a tribune, and Steve Bannon, his former ideologist, was a fitting aedile. Together, they pitched the masses on a world where tariffs and infrastructure spending brought jobs back and immigration reform forced wages to rise. Working-class Americans, unnerved by the perception that corporate elites were profiting at their expense, bought that pitch. In a study of Macomb County, Mich., political-consulting firm Democracy Corps found that Trump’s proposed economic policies were instrumental in winning supporters to his side. By some analyses, the Obama-turned-Trump voters most receptive to those policies swung the election.
It was therefore reasonable to wonder after the election if traditional GOP economic doctrine was to be replaced by an agenda comprising policies the party had rejected long ago. Some heresies were publicly considered: Bannon pushed for an increase to the top marginal tax rate, and the administration continued (and continues) to beat the tariff drum. It began to sound as if Republicans were uncomfortable with their reputation as the party of white-collar interests.
But most of the chatter about economic nationalism wound up being just that. Neither the House nor the Senate came around on these touchstone issues, and standard Republican tax reform now appears to be the party’s best hope for a major legislative achievement in Trump’s first year. Now that Bannon is gone from his post as chief strategist, a debate is blossoming over the White House’s claim to populist credentials. In an interview with The Weekly Standard, Bannon sketched out how his side will approach that debate, dismissing “the Republican establishment,” who are “not populists” nor “nationalists” and have “no interest in [Trump’s] program.” Without economically populist legislative successes — without tariffs, an infrastructure bill, or immigration reform — what can Trump point to for his followers to be proud of?
Well, there’s the stock market. Equity prices have indeed been rising, with the Dow reaching record highs this month. This is partly because strong global growth has buoyed corporate earnings. It’s also partly because Wall Street expects earnings to stay afloat on the back of pro-growth policies such as regulatory reform and a corporate tax cut — and those policies are part of Trump’s portfolio, his protectionist bluster aside.
On the other hand, nobody ever accused Wall Street of being a populist address. So with all this talk about corporate profits, Obama-turned-Trump voters in Macomb County might wonder what’s in it for them — which means, of course, that the conversation must inevitably turn to wages. Unemployment is down to 4.3 percent, as 26,000 more jobs than expected were created in July. Yet despite the tight labor market, the growth of real wages continues to stubbornly lag behind. And while it’s true that economists disagree on the severity of the problem — some identify automation as a downward pressure that is unlikely to vanish while others maintain that wages look healthier when you adjust for changing consumer behavior — the perception that there is a problem is both plausible and politically toxic.
The economic anxieties that Trump exploited so ably during the campaign, then, can hardly be allayed by the performance of the stock market. Meanwhile, would-be populists on the other side of the aisle are certainly hoping that disaffected Trump voters will reconvene under their banners in 2020, if not before. After all, many of them voted for Trump because he insisted that rootless corporate elites were out to get them — and there will continue to be a market for that powerful idea whether he is the one profiting from it or not.
On the merits, there’s nothing wrong with Trump’s pointing to Wall Street and smiling with pride. But it might give voters pause, insofar as anti-corporate populism was a major part of the political magic he used to bedazzle his supporters and frustrate his foes. For now, rhetorical emphasis on the stock market is one of the few PR moves he has. Eventually, though, he’ll need to figure out whether populism can still work for him without his resident populist.