“Inflation is the true opium of the people and it is administered to them by anticapitalist governments and parties.”

–Ludwig von Mises

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September 10, 2024 – Politics are absurd and grotesque. So… tonight we get what we deserve; two marionettes who parody the system they want your vote to “lead.”

If the debate were about policy, Liz Wolfe from Reason suggests with her usual aplomb, we might expect something like this:

Expect border issues to be front and center during this debate, specifically Harris’ record as border czar. Her campaign—and an obsequious mainstream media—has downplayed her role, claiming actually she was in charge of tackling the deeper root causes, so none of the chaos is truly her fault. The Biden/Harris administration has seen a record influx of migrants at the southern border, which they attempted to crack down on via a June executive order that placed restrictions on asylum seekers. 

Expect economic issues to be highlighted, too. Trump will most likely look to ding Harris on the rampant inflation that has the made cost of living far higher under the Biden administration. But they’ve both converged on a broader gospel of economic populism—neither is a fan of free markets, and both want certain types of protectionism and economic interventionism. 

Abortion, a topic Harris’ campaign has attempted to ding Trump on, will also likely be emphasized, especially with Trump’s recent vows to provide free in vitro fertilization to those who seek it and his opposition to Florida’s more restrictive abortion laws. (Another area of slight convergence: Though Trump appointed conservatives to the Supreme Court who ultimately overturned Roe v. Wade and made Dobbs the law of the land, returning the issue to the states, he’s not especially pro-life and tends to favor some leniency on first-trimester abortions.) 

It remains to be seen whether Harris will embrace far-left economic policies—President Joe Biden’s policies, just bigger—or whether she will try to downplay the economic populist agenda she’s cobbled together.

Alas, neither candidate will speak their mind. Their mics will be muted when the other is talking. There will be no audience. The moderators from ABC will cajole the candidates to give real answers, but only to save face for their careers and not embarrass the network in front of advertising execs. 

“This is the Harris-Walz media strategy in a nutshell: Avoid the press at all costs, even when asked questions that should be layups,” argues The New Republic. “The Democratic ticket, or perhaps those who advise them, seem to believe that nothing good can come from talking to the media—that answering questions only invites negative coverage of pseudo-scandals (like [Minnesota Gov. Tim] Walz relatives endorsing Trump) instead of the real issues at stake in November.”

“Trump’s tariffs would cause certain economic ruin,” Liz sums up the unlikely event economics are discussed with any serious effort, “if imposed; but, of course, tariffs are woefully unsexy, so we’ll see how much airtime such things get tonight.”

You’ll recall our note from several days ago. When Barry Goldwater ran a campaign of “extremism in pursuit of liberty” and limited federal spending in 1964, he was directly opposing Lyndon Johnson’s guns and butter program – Vietnam War and the Great Society. 

Goldwater lost in one of the greatest landslides in American electoral history. 

Bill Bonner airs Trump’s proposed tariffs out below. Enjoy ~~ Addison

 

Inflate Or Die

Bill Bonner, Bonner Private Research

Here’s the latest. Bloomberg: 

Trump now threatening 100% tariffs… unless you use the dollar that he is determined to depreciate. 

Donald Trump pledged on Saturday to make it too costly for countries to shift away from using the US dollar, adding a new pillar to his tariff platform. “You leave the dollar and you’re not doing business with the United States because we are going to put a 100% tariff on your goods,” the Republican presidential nominee said at a rally in the battleground state of Wisconsin. The statement follows months of discussions between Trump and his economic advisers on ways to penalize allies or adversaries who seek active ways to engage in bilateral trade in currencies other than the dollar.  

Trump is the first U.S. politician to reveal this part of the scam. The idea is to inflate away the value of the U.S. dollar… but also to trap foreigners in the depreciating currency.  

It’s either inflate… or die. The U.S. economy may be a grotesque zombie with debt growing three times as fast as GDP. But neither political party has the courage to drive a stake through its heart. So, inflation it will be. 

And Donald Trump threatens to make it worse.  

As we know, raising the national debt also raises the cost of debt service (interest). Already over $1 trillion per year, the feds then have to borrow more money to pay it. And this leads them… alas… to ‘print’ money. 

While campaigning in 2016, Mr. Trump offered to help solve this problem by not only balancing the budget, but by paying down the national debt. Of course, it didn’t happen. Instead, his four years in the White House saw debt increase from $20 trillion to $28 trillion — a 40% increase. 

Now, he’s running for office again… and promising more marvels. The Washington Post:  

Trump is vowing to make permanent the measures from his first tax law, which could add an additional $4 trillion to the debt. Many of those tax provisions are otherwise set to expire next year. Several other plans endorsed by Trump, including eliminating taxes on tips and a further reduction in the corporate tax rate, would bring his total tax cut plans above $6 trillion and as high as $7 trillion, according to nonpartisan budget experts.  

Bloomberg News has estimated the price tag at $10 trillion; that figure includes a $5,000-per-child tax credit called for by Sen. JD Vance (R-Ohio), Trump’s running mate, which Trump has not endorsed…  

You gotta hand it to Mr. Trump. Who else would have the cojones to suggest adding $7 trillion to the national debt? But wait. He says that this time he will offset the tax cuts with spending cuts. The Post continues: 

In a speech at the Economic Club of New York on Thursday, Trump promised “trillions” of dollars in spending cuts from a new government commission… that would save “trillions of dollars — trillions. It’s massive. For the same service we have right now.” 

“We’re going to have so much money coming in. We’re going to work on the national debt,” Trump said. “We have to get that down…” 

Ha. Ha. Were these people born yesterday? Or do they think we were born yesterday? Of course, there are trillions that could be cut from federal spending. But each one of those dollars, like raw meat thrown to a pack of hyenas, goes to someone with sharp teeth.  

The Trump team claims it will eliminate ‘waste.’ But there is no ‘waste’ in Washington. Every penny buys influence. And influence buys Washington. 

Mr. Trump also says he won’t touch Social Security, Medicare, veterans’ benefits… or the military. But…  

“From a purely mathematical perspective, if you’re talking about cutting trillions in spending, you are talking about cutting Medicare, Social Security or veterans benefits. There’s no other way to make that math work,” said Bharat Ramamurti, who served as deputy director of the White House National Economic Council under Biden. 

And there you have it. 

Have what? 

Well… bankruptcy. Inflation. The end of the empire. The end of the dollar. A failed state. It’s all there. You can’t really cut spending without digging into the big spending programs. Neither candidate is willing to do that. And Congress has shown even less backbone; it will cut taxes… but not spending. 

And if cutting taxes will help you get elected… and not cutting spending will help you get elected, then the people who get elected are much more likely to cut taxes than cut spending. And deficits, money-printing and inflation are much more likely to be the way forward than responsible budgeting.  

Mr. Trump’s latest proposal is just a way to stick foreigners with some of the losses.  ~~ Bill Bonner, Bonner Private Research

So it goes, 

Addison Wiggin, 

Grey Swan

 

P.S.  Bloomberg analysts note:

A measure of volatility for the dollar is near its highest mark since the March 2023 banking crisis. While U.S. equity futures were little changed in the run-up to the event, the so-called fear gauge in stocks is once again on the upswing. “This debate could be pivotal to the momentum of both campaigns,” according to Kathleen Brooks, research director at foreign exchange broker XTB. “Although there are political shocks happening all over the world, the biggest risk is still the US election in November.”