Does Donald Trump Realize What America Is?

Trump appears to be using a 1970s, or worse, 1930s playbook; and those playbooks did not work even though the US had a large industrial base at those times

Progress

Donald Trump appears to have some sort of fantasy about what America is. I share his pride in this country as it was in the WWII era and maybe beyond, into the 1970s. I am, shall we say mature of age as well. Not nearly Trump’s age, but old enough to remember the inflationary angst of the 1970s and interested enough in economics to know about the post-bubble Great Depression of the 1930s.

I write now as a former manufacturing person. As the threat of Japan’s industrial rise grew steadily in the 1980s, we had to abandon the old ways of doing things, like men cranking handles in a profession (precision machining) that was more craft than labor. In short, in this new globally competitive reality it was “automate or die”. We automated. That was progress. America’s industrial base, following the likes of Japan, progressed even as its gross industrial base contracted under global pressure and yes, the productivity of automation.

Regress

In the 1980s and 1990s, America came under the guidance of financial professionals and politicians who’d never gotten their fingernails dirty a day in their life. The industrial economy was realigned in service to Wall Street’s desire to slice, dice and package financial instruments for profit, as opposed to making things for export profit.

The China fox and its vast pool of cheap labor was invited into the hen house by these politicians as part of a cohort with Wall Street financiers who demand every last drop of profit be squeezed out of an enterprise, and to lesser degrees, Mexico, Indonesia, Taiwan and others that had been industrializing to handle the work previously and proudly “Made In America” (MIA).

MIA still means something. As an example, when I buy an electric guitar, I am very biased to a US made Gibson, PRS or Fender. Indeed, I have three git fiddles, a Gibson SG, Fender Strat and a PRS Studio. All made here, all standing the test of time.

But the regression is in the culture at large. From the 1990s trade agreements on, America has been trained to be a consumerist nation. Again, this was under the guidance of greedy and short-sighted politicians and just plain greedy financial institutions (what we call “Wall Street”).

Tariffs Today

Trump is not playing the hand he thinks he is playing. He is threatening more tariffs on our erstwhile allies Canada and Europe if they work together to do “economic harm” to the US. Sir, he who haphazardly implements the proven-failed regime of tariffs is doing economic harm. Especially when he is doing it at the helm of the Good Ship USS Lollipop, a vessel not yet ready to pick up its own industrial slack to the degree that would satisfy a massive and voracious consumerist society.

But there is more to it than that. More than the “who’s right, who’s wrong?” question about the tariff war. Unless we are in the late stages of a “deal”, Art Of The Deal style, a man who probably never labored a day in this life (other than the extreme energy expended from his mouth and his tweeting and executive order signing fingers) seems to think he is carrying a big, heavy club when in reality, with respect to our industrial base, it is one of those over-sized wiffle ball bats. Light as the air it is filled with.

America became a credit (debt)-fueled consumerist society through shortsighted greed, prompted by Wall Street and the Federal Reserve System and aided/abetted by politicians. In short, Main Street America was sold out.

Sure, America has large deposits of materials and energy resources. We have a strong technological base. We have a tradition of hard work. Although with respect to that last item, 30 years as the consumer to the world, helping build out China for example, by increasing debt-for-consumption while they increased industrial output, has greatly impaired our relative industrial standing. We now have a post-hubris culture that (on balance) thinks it’s as easy as pressing a button on your phone and waiting for your cost-effectively produced product to arrive at your doorstep.

Well, it HAS been just that easy! But in a trade war, including against nations with industrial bases not nearly as devolved as ours, not as dependent on credit-fueled illusions of prosperity as modern America… in that trade war… America stands to lose. We stand to lose because we are the buyers, the world’s foremost consumerist nation. In a trade war, buyers pay the price.

Again, as a US manufacturing person in my former life I watched it happen in real time. I and many others of my ilk warned about it, got pissed over it, accepted it and adjusted (automated) to it.

If Trump is not merely pushing an Art Of The Deal play to the limit (is he that smart?), I believe Americans stand to suffer a disproportionate amount of the losses to come in a trade war. Our base has been degraded. Sure, we can build it back over years or decades. But right now we are flat out dependent on too many cheaply made foreign goods from places that many in our hubris addled society might think of as “dirty”, as beneath us. We’ve been bred this way, after all.

I don’t think Donald Trump realizes what America actually is in 2025. It can be something more productive in future years. But in 2025 it remains a vast consumer nation unprepared for what it will take to produce hard goods competitively for its own people and on the global stage. It is not ready for this war.

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