The Corner

Politics & Policy

Trump Priming

Robert Draper reports that Donald Trump wants to “prime the pump”:

Trump seemed much less animated by the subject of budget cuts than the subject of spending increases. “We’re also going to prime the pump,” he said. “You know what I mean by ‘prime the pump’? In order to get this” — the economy — “going, and going big league, and having the jobs coming in and the taxes that will be cut very substantially and the regulations that’ll be going, we’re going to have to prime the pump to some extent. In other words: Spend money to make a lot more money in the future. And that’ll happen.” A clearer elucidation of Keynesian liberalism could not have been delivered by Obama.

A few points about this:

First: If Trump is serious about this, then, perhaps needless to say, deficit reduction is off the table. If he offsets higher infrastructure spending with spending cuts elsewhere, or makes sure his tax reform is revenue-neutral, he’ll defeat his pump-priming purpose.

Second: The pump-priming rationale isn’t just an argument for more deficit spending; it’s an argument for relatively indiscriminate deficit spending. To the extent that the goal of an infrastructure-building program is to make America more productive, then policymakers should seek bang for the buck. They should try to spend as little as possible to get the most and highest-quality infrastructure. To the extent the goal of the program is to get money into people’s pockets, they should think exactly the opposite way. Pay people to dig with spoons, not shovels.

Third: Even assuming the soundness of Keynesian views about fiscal stimulus, now is not the time that they would recommend higher deficits. The case for higher deficits as a way to expand the economy as a whole is much, much weaker than it was at the trough of the great recession in 2009. If Trump’s spending increased total spending throughout the economy, that extra spending would be more likely to take the form of inflation than of increased economic activity than it would have been then.

Fourth: But a burst of federal spending probably wouldn’t increase total spending anyway, but instead just cause the Federal Reserve to tighten monetary policy more and faster than it otherwise would have. In that case we’d have more government spending and less private-sector spending within a roughly unchanged total.

Ramesh Ponnuru is a senior editor for National Review, a columnist for Bloomberg Opinion, a visiting fellow at the American Enterprise Institute, and a senior fellow at the National Review Institute.

Most Popular

The Arson Party

About that peaceful transfer of power . . . I do not have access to my friend Mario Loyola’s Donald J. Trump super-secret decoder ring, but I am inclined to accept Loyola’s explanation that what President Trump was trying to say, but couldn’t quite manage to say, was the usual witless Trump trolling -- ... Read More

The Arson Party

About that peaceful transfer of power . . . I do not have access to my friend Mario Loyola’s Donald J. Trump super-secret decoder ring, but I am inclined to accept Loyola’s explanation that what President Trump was trying to say, but couldn’t quite manage to say, was the usual witless Trump trolling -- ... Read More
Politics & Policy

Do You Want 51 or 52 States Next Year?

“The prospects of statehood for Puerto Rico and Washington, D.C., have never been greater, but many significant obstacles loom,” The Hill declares. The Constitution declares, “new States may be admitted by the Congress into this Union; but no new State shall be formed or erected within the Jurisdiction ... Read More
Politics & Policy

Do You Want 51 or 52 States Next Year?

“The prospects of statehood for Puerto Rico and Washington, D.C., have never been greater, but many significant obstacles loom,” The Hill declares. The Constitution declares, “new States may be admitted by the Congress into this Union; but no new State shall be formed or erected within the Jurisdiction ... Read More
Law & the Courts

No, the Democrats Won’t Pack the Court

For many progressive opinion-makers, the only way to save the Supreme Court is to destroy it.   They believe the best response to the Republican-held Senate confirming a Trump nominee to fill Ruth Bader Ginsburg's seat on the Supreme Court is to pack the Court if Democrats win in November. Holding out the ... Read More
Law & the Courts

No, the Democrats Won’t Pack the Court

For many progressive opinion-makers, the only way to save the Supreme Court is to destroy it.   They believe the best response to the Republican-held Senate confirming a Trump nominee to fill Ruth Bader Ginsburg's seat on the Supreme Court is to pack the Court if Democrats win in November. Holding out the ... Read More