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Dow dreamers show Trump's war on elites is pure fantasy Dow dreamers show Trump's war on elites is pure fantasy
(1 day later)
Observers of the thousand-man wrecking crew now smashing up America’s executive branch often grouse about the many ways in which it violates the “norms” of our country’s politics. What impresses me as I observe the unfolding Trumptacular is the opposite: how familiar it sometimes is.Observers of the thousand-man wrecking crew now smashing up America’s executive branch often grouse about the many ways in which it violates the “norms” of our country’s politics. What impresses me as I observe the unfolding Trumptacular is the opposite: how familiar it sometimes is.
By a coincidence that of course isn’t a coincidence at all, the Trump administration now features as the chair of its Council of Economic Advisors one Kevin Hassett, an economist who in 1999 co-authored an infamous declaration that the Dow Jones Industrial Average deserved to be at 36,000. To direct his National Economic Council, meanwhile, Trump has nominated Larry Kudlow, who also proposed a wildly optimistic take on stock prices back then, in his case a prediction that the Dow Jones Industrial Average would go to 50,000 by 2020. By a coincidence that of course isn’t a coincidence at all, the Trump administration now features as the chair of its Council of Economic Advisers one Kevin Hassett, an economist who in 1999 co-authored an infamous declaration that the Dow Jones Industrial Average deserved to be at 36,000. To direct his National Economic Council, meanwhile, Trump has nominated Larry Kudlow, who also proposed a wildly optimistic take on stock prices back then, in his case a prediction that the Dow Jones Industrial Average would go to 50,000 by 2020.
One coincidence more: the two future Trump appointees made their hallucinatory calls back to back, in the pages of the Wall Street Journal on March 16 and March 17, 1999. I still keep yellowing copies of their op-eds in a file in my office; that’s how astounding they seemed to me at the time. One coincidence more: the two future Trump appointees made their hallucinatory calls back to back, in the pages of the Wall Street Journal on 16 and 17 March 1999. I still keep yellowing copies of their op-eds in a file in my office; that’s how astounding they seemed to me at the time.
Then again, that sort of thing was in the air in those days. The Dow was approaching the awesome figure of 10,000, and business sections everywhere were aflame with a kind of free-market Pentecost, a capitalist rapture. Every bubble seems to bring the same euphoric visions: prosperity onward and upward, forever and ever, amen.Then again, that sort of thing was in the air in those days. The Dow was approaching the awesome figure of 10,000, and business sections everywhere were aflame with a kind of free-market Pentecost, a capitalist rapture. Every bubble seems to bring the same euphoric visions: prosperity onward and upward, forever and ever, amen.
Unfortunately, about a year after the two men’s predictions appeared, the dot-com bubble burst and the dreams of a stock market soaring from gravity’s grip burst with them. Unfortunately, about a year after the two men’s predictions appeared, the dotcom bubble burst and the dreams of a stock market soaring from gravity’s grip burst with them.
Kudlow, the more interesting of Trump’s Dow dreamers, didn’t seem to be chastened by this experience; he went on to a career as a TV business commentator, delivering an amazing series of bum steers as the years rolled by. And now, as if in recognition of his dreadful lifetime achievements, he is to be appointed director of the National Economic Council. He has failed about as far as one can fail.Kudlow, the more interesting of Trump’s Dow dreamers, didn’t seem to be chastened by this experience; he went on to a career as a TV business commentator, delivering an amazing series of bum steers as the years rolled by. And now, as if in recognition of his dreadful lifetime achievements, he is to be appointed director of the National Economic Council. He has failed about as far as one can fail.
What could our success-worshiping president possibly see in such a man? Does Trump actively want to get bad advice? Is Kudlow’s flattery worth that much?What could our success-worshiping president possibly see in such a man? Does Trump actively want to get bad advice? Is Kudlow’s flattery worth that much?
Maybe, but I think there’s more to it than that. Business itself may be a matter of hard numbers, but business commentary is often a thing of soaring ideological fancy. And the ideology in Kudlow’s case is a powerful form of populism.Maybe, but I think there’s more to it than that. Business itself may be a matter of hard numbers, but business commentary is often a thing of soaring ideological fancy. And the ideology in Kudlow’s case is a powerful form of populism.
By cheering for the stock market, one cheered for the common man: this is what Kudlow seemed to believe in the days when I followed him. Markets were arenas of primal Jeffersonian democracy, and the stories the business pages told were really tales of a vast, ongoing confrontation in which the common people – “the shareholders, farmers, seniors, homeowners, website operators, venture capitalists, small-business men and others,” as Kudlow once described them – squared off against the arrogant and destructive tribe Kudlow loved to revile as the “economic establishment”.By cheering for the stock market, one cheered for the common man: this is what Kudlow seemed to believe in the days when I followed him. Markets were arenas of primal Jeffersonian democracy, and the stories the business pages told were really tales of a vast, ongoing confrontation in which the common people – “the shareholders, farmers, seniors, homeowners, website operators, venture capitalists, small-business men and others,” as Kudlow once described them – squared off against the arrogant and destructive tribe Kudlow loved to revile as the “economic establishment”.
Trump seems to be betting that the substance of the populist narrative doesn’t matter as much as the rhetoricTrump seems to be betting that the substance of the populist narrative doesn’t matter as much as the rhetoric
Who was this establishment? They were university professors, Kudlow wrote, intellectuals “who had wrapped themselves in the comfortable and smug self-knowledge that economics could only be managed by distinguished university dons; free-markets and the unfettered actions of ordinary people in commerce, trade and finance was a dangerous thing, something that must be tightly controlled … ” Who was this establishment? They were university professors, Kudlow wrote, intellectuals “who had wrapped themselves in the comfortable and smug self-knowledge that economics could only be managed by distinguished university dons; free-markets and the unfettered actions of ordinary people in commerce, trade and finance was a dangerous thing, something that must be tightly controlled …”
As a description of the discipline of economics this was ridiculous. As part of the age-old campaign to make big business seem like your beloved pal – to make the big shots on Wall Street appear to be men of the people – it was kind of ingenious. The idea was that markets speak with the people’s voice; that those who would regulate, tax, supervise, break up monopolies or organize unions are snobs, university big-shots who longed to keep “ordinary people” in their place.As a description of the discipline of economics this was ridiculous. As part of the age-old campaign to make big business seem like your beloved pal – to make the big shots on Wall Street appear to be men of the people – it was kind of ingenious. The idea was that markets speak with the people’s voice; that those who would regulate, tax, supervise, break up monopolies or organize unions are snobs, university big-shots who longed to keep “ordinary people” in their place.
Fantasizing about the vicimization of venture capitalists isn’t what got Donald Trump elected in 2016. But by appointing Kudlow, the president seems to be betting that the substance of the populist narrative doesn’t matter as much as does the superficial rhetoric of the thing. And so, before our eyes, the bitter blue-collar gripes of the Steve Bannon era are being exchanged for the sunny supply-side credo of Larry Kudlow. One form of populism growls darkly about “American carnage”, the other burbles about the day big business is liberated from arrogant regulators, but both pretend to despise elites, and maybe that’s all that matters.Fantasizing about the vicimization of venture capitalists isn’t what got Donald Trump elected in 2016. But by appointing Kudlow, the president seems to be betting that the substance of the populist narrative doesn’t matter as much as does the superficial rhetoric of the thing. And so, before our eyes, the bitter blue-collar gripes of the Steve Bannon era are being exchanged for the sunny supply-side credo of Larry Kudlow. One form of populism growls darkly about “American carnage”, the other burbles about the day big business is liberated from arrogant regulators, but both pretend to despise elites, and maybe that’s all that matters.
The real danger in elevating Kudlow to a position of such great public authority, I think, is not that he will continue to misapprehend the world (though of course he will), but that he will be in a position to put his destructive ideology into effect. When Kudlow predicted that the Dow would hit 50,000, for example, he wrote that it would happen by the year 2020 – a time when he himself may well be directing the National Economic Council.The real danger in elevating Kudlow to a position of such great public authority, I think, is not that he will continue to misapprehend the world (though of course he will), but that he will be in a position to put his destructive ideology into effect. When Kudlow predicted that the Dow would hit 50,000, for example, he wrote that it would happen by the year 2020 – a time when he himself may well be directing the National Economic Council.
How might Kudlow contrive to make his prediction come true? His own writings from the bubble days suggest the answer: more tax cuts, of course; plenty of deregulation; and maybe even what Kudlow once coyly called “individual ownership of social security contributions”.How might Kudlow contrive to make his prediction come true? His own writings from the bubble days suggest the answer: more tax cuts, of course; plenty of deregulation; and maybe even what Kudlow once coyly called “individual ownership of social security contributions”.
So the old shell game plays out once more. In, 2016 millions of average Americans enthusiastically signed up for a war on elites; with boisterous hurrahs they climbed aboard the Trump train; and after a few years’ journey they are going to find themselves deposited right back where they started, with inequality growing, more monopolies springing up, and Wall Street ideologues running everything. So the old shell game plays out once more. In 2016 millions of average Americans enthusiastically signed up for a war on elites; with boisterous hurrahs they climbed aboard the Trump train; and after a few years’ journey they are going to find themselves deposited right back where they started, with inequality growing, more monopolies springing up, and Wall Street ideologues running everything.
In the meantime, the Don and Larry show is just getting started. Replace the “failed and corrupt establishment,” shouts Don. Yes, “overthrow the establishment,” agrees Larry. How the elites must tremble at the prospect. In the meantime, the Don and Larry show is just getting started. Replace the “failed and corrupt establishment”, shouts Don. Yes, “overthrow the establishment,” agrees Larry. How the elites must tremble at the prospect.
Donald TrumpDonald Trump
OpinionOpinion
US politicsUS politics
Trump administrationTrump administration
US economyUS economy
EconomicsEconomics
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