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| Donald Trump applies art of exaggeration to handling of US economy | Donald Trump applies art of exaggeration to handling of US economy |
| (4 months later) | |
| The president boasted of using inflated figures in his business dealings and seems bent on using similar tactics to justify protectionism despite IMF warnings | |
| Edward Helmore | |
| Tue 10 Oct 2017 18.36 BST | |
| Last modified on Tue 10 Oct 2017 20.14 BST | |
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| In his interview with Forbes, published on Tuesday, Donald Trump showed how his self-confessed tactics of exaggeration when negotiating business deals are now being applied to the US economy. He also called for protectionist measures, directly clashing with recommendations contained in a key International Monetary Fund (IMF) report released the same day. | In his interview with Forbes, published on Tuesday, Donald Trump showed how his self-confessed tactics of exaggeration when negotiating business deals are now being applied to the US economy. He also called for protectionist measures, directly clashing with recommendations contained in a key International Monetary Fund (IMF) report released the same day. |
| Saying his administration was working on a “fantastic” economic bill “which nobody knows about”, Trump offered no details but said the bill contained “economic-development incentives” for companies to stay in the US. Companies sending jobs overseas, he said, would “get penalised severely”. | Saying his administration was working on a “fantastic” economic bill “which nobody knows about”, Trump offered no details but said the bill contained “economic-development incentives” for companies to stay in the US. Companies sending jobs overseas, he said, would “get penalised severely”. |
| “It’s both a carrot and a stick,” he said. “It is an incentive to stay. But it is perhaps even more so – if you leave, it’s going to be very tough for you to think that you’re going to be able to sell your product back into our country.” | “It’s both a carrot and a stick,” he said. “It is an incentive to stay. But it is perhaps even more so – if you leave, it’s going to be very tough for you to think that you’re going to be able to sell your product back into our country.” |
| The IMF report on the global economy contained a rebuke to protectionist policies. “Although the chances of advanced economy policies turning inward have diminished in the near term, pressures for increased protectionism have not disappeared and ought to be resisted,” it read. | The IMF report on the global economy contained a rebuke to protectionist policies. “Although the chances of advanced economy policies turning inward have diminished in the near term, pressures for increased protectionism have not disappeared and ought to be resisted,” it read. |
| According to the report, increased growth is forecast in the US, the eurozone, Japan and China this year, with world trade expected to grow 4.2% – its fastest rate in six years. The last time the global economy grew so fast was in 2010, in a short-lived recovery from the 2008 financial crisis. | According to the report, increased growth is forecast in the US, the eurozone, Japan and China this year, with world trade expected to grow 4.2% – its fastest rate in six years. The last time the global economy grew so fast was in 2010, in a short-lived recovery from the 2008 financial crisis. |
| This year’s performance is significantly stronger, the IMF chief economist, Maurice Obstfeld, told the Financial Times. “This is not bounce-back from a sharp deceleration; this is an acceleration from the fairly tepid growth rates of recent years, so that’s really good news,” he said. | This year’s performance is significantly stronger, the IMF chief economist, Maurice Obstfeld, told the Financial Times. “This is not bounce-back from a sharp deceleration; this is an acceleration from the fairly tepid growth rates of recent years, so that’s really good news,” he said. |
| Trump nonetheless feels the US economy is in need of protection. Asked by Forbes if he was comfortable with measures that the private sector would largely oppose, he said: “Very comfortable. What I want to do is reciprocal. | Trump nonetheless feels the US economy is in need of protection. Asked by Forbes if he was comfortable with measures that the private sector would largely oppose, he said: “Very comfortable. What I want to do is reciprocal. |
| “See, I think the concept of reciprocal is a very nice concept. If somebody is charging us 50%, we should charge them 50%. Right now they charge us 50%, and we charge them nothing. That doesn’t work with me.” | “See, I think the concept of reciprocal is a very nice concept. If somebody is charging us 50%, we should charge them 50%. Right now they charge us 50%, and we charge them nothing. That doesn’t work with me.” |
| Trump’s words echoed those in the pages of The Art of the Deal, his bestselling 1980s advertisement for his own his business acumen. He has often described how he uses inflated numbers as a negotiating tactic, often then employing the same numbers to declare victory after the fact. | Trump’s words echoed those in the pages of The Art of the Deal, his bestselling 1980s advertisement for his own his business acumen. He has often described how he uses inflated numbers as a negotiating tactic, often then employing the same numbers to declare victory after the fact. |
| Forbes quoted Trump’s words from 1984, when he bought a now long-defunct franchise, the New Jersey Generals, in a now long-defunct competition, the United States Football League. | Forbes quoted Trump’s words from 1984, when he bought a now long-defunct franchise, the New Jersey Generals, in a now long-defunct competition, the United States Football League. |
| “When I build something for somebody, I always add $50m or $60m on to the price,” the magazine quoted him as saying. “My guys come in, they say it’s going to cost $75m. I say it’s going to cost $125m and I build it for $100m. Basically, I did a lousy job. But they think I did a great job.” | “When I build something for somebody, I always add $50m or $60m on to the price,” the magazine quoted him as saying. “My guys come in, they say it’s going to cost $75m. I say it’s going to cost $125m and I build it for $100m. Basically, I did a lousy job. But they think I did a great job.” |
| Trump told Forbes about his current proposal to cut the corporate tax rate to 20% – after months of saying he wanted to go even lower, to 15%. “I was actually saying 15 for the purpose of getting to 20,” he said. “As you know, this will be a negotiation for the next 30 days. But I wanted the 15 in order to get to 20.” | Trump told Forbes about his current proposal to cut the corporate tax rate to 20% – after months of saying he wanted to go even lower, to 15%. “I was actually saying 15 for the purpose of getting to 20,” he said. “As you know, this will be a negotiation for the next 30 days. But I wanted the 15 in order to get to 20.” |
| Using impressive numbers, Forbes pointed out, is essential to Trump’s reflexive habit of establishing hierarchy. | Using impressive numbers, Forbes pointed out, is essential to Trump’s reflexive habit of establishing hierarchy. |
| “So GDP last quarter was 3.1%,” he said. “Most of the folks that are in your business, and elsewhere, were saying that would not be hit for a long time. You know, Obama never hit the number.” | “So GDP last quarter was 3.1%,” he said. “Most of the folks that are in your business, and elsewhere, were saying that would not be hit for a long time. You know, Obama never hit the number.” |
| Asked to comment on soaring US stock indexes, which are up as much as 20% since the start of his term, Trump said the real number was 25%. | Asked to comment on soaring US stock indexes, which are up as much as 20% since the start of his term, Trump said the real number was 25%. |
| “Since election day it’s 25%,” he said. “It has gone up since election day $5.2tn – $5.2tn. If Hillary Clinton would have won, the markets would have gone down substantially.” | “Since election day it’s 25%,” he said. “It has gone up since election day $5.2tn – $5.2tn. If Hillary Clinton would have won, the markets would have gone down substantially.” |
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