Wed, Jun 07, 2017 - Page 9 News List

Managing Trump’s rogue America

By investing in technology and education, Europe and Asia can achieve an almost insurmountable advantage over the US in building the ‘green’ technologies of the future

By Joseph Stiglitz

Illustration: Mountain People

US President Donald Trump has thrown a hand grenade into the global economic architecture that was so painstakingly constructed in the years after the end of World War II. The attempted destruction of this rules-based system of global governance — now manifested in Trump’s withdrawal of the US from the 2015 Paris climate agreement — is just the latest aspect of the US president’s assault on our basic system of values and institutions.

The world is only slowly coming fully to terms with the malevolence of the Trump administration’s agenda. He and his cronies have attacked the US press — a vital institution for preserving Americans’ freedoms, rights and democracy — as an “enemy of the people.” They have attempted to undermine the foundations of our knowledge and beliefs — our epistemology — by labeling as “fake” anything that challenges their aims and arguments, even rejecting science itself. Trump’s sham justifications for spurning the Paris climate agreement is only the most recent evidence of this.

For millennia before the middle of the 18th century, standards of living stagnated. It was the Enlightenment, with its embrace of reasoned discourse and scientific inquiry, that underpinned the enormous increases in standards of living in the subsequent two and a half centuries.

With the Enlightenment also came a commitment to discover and address our prejudices. As the idea of human equality — and its corollary, basic individual rights for all — quickly spread, societies began struggling to eliminate discrimination on the basis of race, gender and, eventually, other aspects of human identity, including disability and sexual orientation.

Trump seeks to reverse all of that. His rejection of science — in particular climate science — threatens technological progress, and his bigotry toward women, Hispanics and Muslims (except those, like the rulers of Gulf oil sheikhdoms, from whom he and his family can profit), threatens the functioning of US society and its economy by undermining people’s trust that the system is fair to all.

As a populist, Trump has exploited the justifiable economic discontent that has become so widespread in recent years, as many Americans have become downwardly mobile amid soaring inequality. However, his true objective — to enrich himself and other gilded rent-seekers at the expense of those who supported him — is revealed by his tax and healthcare plans.

Trump’s proposed tax reforms, so far as one can see, outdo former US president George W. Bush’s in their regressivity (the share of the benefits that go to those at the top of the income distribution).

Moreover, in a country where life expectancy is already declining, his healthcare overhaul would leave 23 million more Americans without health insurance.

While Trump and his Cabinet may know how to make business deals, they have not the slightest idea how the economic system as a whole works. If the administration’s macroeconomic policies are implemented, they will result in a larger trade deficit and a further decline in manufacturing.

The US will suffer under Trump. Its global leadership role was being destroyed, even before Trump broke faith with more than 190 countries by withdrawing from the Paris accord.

At this point, rebuilding that leadership will demand a truly heroic effort. We share a common planet and the world has learned the hard way that we have to get along and work together. We have learned, too, that cooperation can benefit all.

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