“He just says, ‘Well, I’m going to negotiate a better deal.’ Well, what, how exactly are you going to negotiate that? What magic wand do you have?
– Barack Obama, in a 2016 statement about Donald Trump
November 8, 2024— Brace yourself for a shocking statement: European elites are stunned, perhaps even aghast, at Donald Trump’s election victory.
Not for the first time, either. Trump’s 2016 victory, on the back of Brexit, showed the elites that sometimes, the little guy hits back against their agenda and smug assurance that they’re the masters of the universe. Even if their choice of hitter is part of the ruling elite (and a billionaire) himself.
We’ve noted a few times that over the past 15 years, the U.S. has seen its GDP double. The growth hasn’t been as fast as in the past, thanks to our high (and still increasing!) debt levels.
But, compared to other industrialized nations, U.S. citizens are faring much better. The Eurozone as a whole has not seen its economy grow at all in the same 15 years.
European GDP is flat.
At some point, European countries decided that things were “good enough.” Rather than focus on economic growth, they’d instead grow their welfare states, making it easier for their populations to kick back and relax.
More power to them. It’s their culture, after all.
American culture is different. And by embracing lower taxes and less of a regulatory burden than European nations, the results over the past 15 years have been staggering.
The Obama era tried to follow a Europe-light course, and Trump’s first term reversed that trend. Bigly. It turns out you don’t need a magic wand for more economic growth. Just more freedom and fewer restrictions.
Lower taxes, limited government.
Y’know, like what a chorus of folks around the time of the writing of the Constitution believed. Or at least wrote down for us to find in the dusty archive of a library somewhere. Everywhere.
It’s true.
You can’t grow your way out of all of America’s problems. But economic growth, it turns out, is better for its citizens, than not trying to grow the economy at all.
Running up debt and encouraging its citizens to do the same is, well, one of the issues that needs addressing. But we’re going to do like any good U.S. House member and leave that doozy in the bin for some later generation to wring their hands over.
Today, our favorite Scottish historian Niall Ferguson, takes a Friday guest essay look at “the greatest political comeback of all time” and why the elites have lost their smug grins… for a few days, at least. Enjoy – Addison
The Resurrection of Donald J. Trump
Niall Ferguson, The Free Press
It’s tempting for me to say this isn’t a surprise.
Back in May last year, I predicted “Trump’s second act,” telling Spectator readers: “He can still win, in spite of everything.” My point was that the Democrats’ strategy of lawfare against Donald Trump was highly likely to backfire. “If Lula [da Silva] can come back from one-and-a-half-years in jail to win” the Brazilian presidency, I wrote, “Trump may have little to worry about, as there isn’t the slightest chance of his being locked up between now and Election Day next year. Indeed, the perception that Democratic operatives are using the legal system for political ends will likely help him win votes.”
“Joe Biden,” I concluded, “is in serious danger of following Gerald Ford, Jimmy Carter, and George H.W. Bush into the bin marked ‘one-term presidents.’ ”
Last week, too, I was ready to predict that Kamala Harris was destined for the bin marked “incumbent vice presidents who lost.”
Nevertheless, I am surprised by the scale of Trump’s win.
They used to call Bill Clinton “the Comeback Kid.” He cut a forlorn figure these past few days, trying feebly to drum up enthusiasm for the Democrats’ worst candidate since George McGovern. Well, move over, Bill. There’s a new Comeback Kid in town. Except that Trump is the Comeback King.
This is a bigger comeback than Grover Cleveland’s in 1892, when he became the first—and, until last night, only—American president to win a second nonconsecutive term. This is a bigger comeback than Richard Nixon’s, when he was elected president in 1968, eight years after he lost by a dubious whisker to John F. Kennedy. It’s bigger than Winston Churchill’s multiple comebacks, the biggest of which were in 1940 and 1951. It’s bigger than Charles de Gaulle’s in 1958. It’s bigger than Napoleon’s Hundred Days in 1815. In fact, I am tempted to say that the only comeback it’s not bigger than is the Resurrection.
Why? Because all of Trump’s political opponents made a vain effort to destroy him. In the words of Elon Musk—who has been a key variable in Trump’s epic comeback—Trump is the man “who they tried to kill twice, bankrupt, and imprison for eternity.” Trump faced two assassination attempts, one of which came within an inch of killing him. He was indicted in four criminal cases and convicted in one of them. He was impeached twice as president, in December 2019 (over his infamous call to Ukrainian president Volodymyr Zelensky) and again in January 2021 (over the mob’s invasion of the Capitol on January 6).
In a civil case in May 2023, a Manhattan jury found him liable for sexually abusing and defaming the journalist E. Jean Carroll, awarding her $5 million in damages. Last May, he was convicted in a Manhattan court on 34 felony counts relating to hush money payments to adult film star Stormy Daniels. My colleague Eli Lake puts the grand total at 116 indictments. This wasn’t just lawfare; it was total lawfare.
And still he won. He totally won.
What all this goes to show is that Trump is authentically antifragile. That term originated with my brilliant friend Nassim Nicholas Taleb. Let me quote his definition from the book Antifragile: “Antifragility. . . is beyond robustness: It is about loving randomness and disorder and benefiting from shocks. And love of randomness is love of errors. Antifragility has a singular property of allowing us to do things without understanding them—and do them well, mostly much better than by understanding them.”
Friedrich Nietzsche put it more elegantly: Was mich nicht umbringt, macht mich stärker. “What doesn’t kill me, makes me stronger.” That famous aphorism, from Twilight of the Idols (1889), will provide the perfect epigraph for the first serious biography of Trump, when a younger version of me gets around to writing it.
The extent of Trump’s victory is truly stunning. Apart from J.D. Vance’s childless cat ladies, Trump gained ground with almost every demographic. As of this writing, he appears to have won all seven of the swing states. And, of course, he crushed it in Iowa. (Sorry about that poll, J. Ann Selzer. You were 17 points off. Good luck with the next chapter in your career.)
Trump has destroyed the Obama coalition, which depended on the mobilization of minorities by the Democrats. According to exit polls, he won 54 percent of Latino men. After all the agonizing about comedian Tony Hinchcliffe calling Puerto Rico “garbage” at a Trump rally, there was a massive shift in the Florida Puerto Rican vote—to Trump. True, Harris won the demographic 52 percent to 43 percent, but Biden won the same group 69 percent to 31 percent four years ago. That’s a 17-point swing.
Trump also seems to have won over a significant number of black men. According to the NBC News exit poll, Trump won 20 percent of the black vote in Wisconsin, compared with 8 percent in 2020. To give just one example from another swing state, Trump even won Anson County, North Carolina, which is 40 percent black, making him just the second Republican to win this county since the 1870s—in other words, since Reconstruction.
Finally, Trump has won over a significant chunk of younger Americans, most probably young men, who have swung right on a scale woefully underestimated by Democratic strategists.
What are the implications of this historic realignment? The obvious point is that the GOP sweep of the White House, the Senate, and likely the House gives the Republicans a rare opportunity. Will they make better use of it than they did in 2017–18? My bet is yes. Eight years ago, Trump did not expect to win. His administration was cobbled together with elements of the Republican Party and military establishments that were fundamentally opposed to the Make America Great Again agenda.
This time really will be different. This election was a crushing defeat for political lawfare, critical race theory, woke campuses, biological males in women’s sports, genital mutilation of teenagers, the Ivy League, the legacy media, and Hollywood. But it was also a defeat for the neoconservative Never Trumpers, including Liz Cheney as well as all the former Trump officials who turned their coats and backed Harris. And it was a victory for SpaceX, for Starlink, for Polymarket, for Bitcoin, for Anduril, for Palantir, for Marc Andreessen, for Joe Lonsdale, for Joe Rogan, for The Free Press—in short, for the new generation of builders whose autistic-virile qualities Musk exemplifies.
The possibility, therefore, now exists for an administration to approach our dysfunctional federal government in the same way Javier Milei approached Argentina’s since his election as president a year ago—with a chainsaw.
“At the suggestion of Elon Musk, who has given me his complete and total endorsement,” Trump told the Economic Club of New York on September 4, “I will create a government efficiency commission tasked with conducting a complete financial and performance audit of the entire federal government and making recommendations for drastic reforms.” By the end of October, Musk was talking about a new “Department of Government Efficiency” (DOGE, for short—a crypto in-joke about his favorite meme coin—that would cut $2 trillion from the federal budget).
All I can say is: Bring it on. Start by reactivating the “Schedule F” executive order, originally issued in late 2020 and later reversed by the Biden administration, which will allow Trump to hire and fire at will roughly 50,000 civil service positions. Let the firing begin within 48 hours of Inauguration Day.
The conventional wisdom on Trump’s fiscal policy will, as usual, be wrong. Yes, he will extend the soon-to-expire tax cuts of his first administration. (He may also seek to repeal Inflation Reduction Act provisions, though these have been so beneficial to red states that it’s hard to see good political reasons for doing so.) But the idea that his fiscal policy would blow out the deficit more than Harris’s would have rested on bad economics, underestimating the ways in which growth will benefit from Trump’s election. The main drivers of the deficit are mandatory outlays on programs such as Social Security and Medicare. Only radical reform of the sort envisioned by Musk can address those problems.
The conventional wisdom in Trump’s foreign policy will also turn out to be wrong, I predict. The error is to think of the Trump-Vance administration as isolationist and therefore indifferent to the fate of Ukraine and other embattled democracies.
Harris would mostly have continued Biden’s foreign policy, except that she would have been even more dovish on Iran. That would have been bad for Israel and disastrous for Ukraine—which was destined for defeat if the West’s present policy of too-little-too-late had continued.
By contrast, Trump will be much tougher on Iran, will support Israel in its efforts to end Iran’s nuclear program, and will increase the economic pressure on China with a new round of tariffs. Yes, Trump has repeatedly said he wants to end the Russia-Ukraine war. But what we don’t yet know is whether he’ll do this by throwing the Ukrainians to the Russian wolves, as Tucker Carlson recommends, or by exerting greater military pressure on Russia, as Tom Cotton, Robert O’Brien, and Mike Pompeo recommend. My bet is on the latter.
Why? Because Trump and Vance, as well as House Speaker Mike Johnson, now understand that the United States faces a real axis of authoritarian powers—China, Russia, Iran, and North Korea. They understand that a win for Vladimir Putin in Ukraine would also be a win for Xi Jinping, Ali Khamenei, and Kim Jong Un. And they understand that, in the new Cold War we find ourselves fighting, only by reestablishing deterrence can the risk of World War III be averted.
Back in April 2021, in the glad confident morning of the Biden-Harris administration, I offered a critical take on their first Hundred Days for Persuasion:
The combination of several trillion dollars of Covid relief plus infrastructure spending and a central bank that just changed its own inflation targeting regime worries more economists than just Larry Summers. And I can think of other things to be concerned about besides economic overheating: a surge of illegal immigration, a crime wave in the wake of last summer’s anti-police protests, and the “woke” culture to which this administration constantly panders. Watch out, too, for the geopolitical crisis as Cold War II threatens to turn hot over Taiwan. The big risk for Biden’s presidency is that it ends up as a rerun of Jimmy Carter’s.
It’s not coincidental that Trump’s campaign has made regular use of two Ronald Reagan slogans: “Are you better off today than you were four years ago?” and “Peace through strength.” In that sense, this election more closely resembles Reagan’s victory over Carter in 1980 than any other in recent times.
Trump Derangement Syndrome blinds many otherwise intelligent people to the line of continuity from Reagan to Trump. They forget that Reagan, too, was a master of the comeback. He did not win the Republican nomination in 1976, so his victory in 1980 was at the second attempt. More importantly, Reagan’s election marked the beginning of the great American Comeback that culminated in victory in Cold War I.
The comeback that will lead to victory in Cold War II starts here. Hail to the chief. Hail to the Antifragile President. ~~ Niall Ferguson, The Free Press
Regards,
Addison Wiggin,
Grey Swan
P.S. Regarding the election, loyal reader Marcus P. writes:
“Things will go well in 2025 if (and this is a big IF) Elon Musk is successful at cutting the $2 trillion from our government expenditures as he anticipated.
If that happens, it will reduce the pressure on our government to borrow money to pay our debts. This will set into motion a domino effect of positive results.”
We intend to find out.
Our Portfolio Manager Andrew Packer will be at the Mises Institute annual event Fort Myers this weekend. Two sessions of particular interest while we anticipate Trump 2.0: Murray Sabrin’s “Bipartisan Spending, Money Printing, and Debt: The Myth of the Two-Party System.” And Tom DiLorenzo’s, “Politics and Economics of the Deep State Monopoly.”
Send your thoughts to: addison@greyswanfraternity.com