In Russia, pump primes you!
Pump-priming used by a Republican has a different meaning than the one Trump invokes, but then again, since Trump has a thing for Andrew Jackson, perhaps a recessionary chaos like the Panic of 1837 is how he wants to prime the economy.
Trump was talking perhaps about the mythical effect of supply-side policy using tax reduction, even if his brand is more about deficits and debt in the service of ruling class wealth building. Tax cuts for 1% me but not for 99% thee.
Like corporate inversions are simply an inconvenience rather than looting the treasury. And the Whig party will return much like nothing is laundered using luxury goods or real estate.
But beyond that it’s OK if the tax plan increases the deficit?
It is OK, because it won’t increase it for long. You may have two years where you’ll…you understand the expression “prime the pump”?
Yes.
We have to prime the pump.
It’s very Keynesian.
We’re the highest-taxed nation in the world. Have you heard that expression before, for this particular type of an event?
Priming the pump?
Yeah, have you heard it?
Yes.
Have you heard that expression used before? Because I haven’t heard it. I mean, I just…I came up with it a couple of days ago and I thought it was good. It’s what you have to do.
It’s…
Yeah, what you have to do is you have to put something in before you can get something out.
Dude, how did you get through the UPenn econ courses or did you do them at Fordham. Needless to say, Trump is trying to sound less like his LIVs, and make them think that tax cutting is the same as fiscal policies… really the guy you want determining the leadership of the Federal Reserve in 2018 …
Wait, the RWNJs want that killed like the Department of Education, so the 2018 Fed leadership will be like Steve “Simon Legree” Mnuchin at Treasury producing Suicide Squad, except with a national economy.
A simple slip of the tongue by Trump? I don't think so. Here's the thing with Trump: He is someone who has always created his own version of events and reality.
One of his tried and true tactics as a businessman was, no matter the outcome of a deal, to declare victory and move on. He would aim to win the next day's press story -- knowing that
for lots of people not paying close attention that would be all they would hear.
Jump-start would imply that Trump even looks under hoods rather than consort with them.
Mr Mnuchin: And as we talked about, economic growth under the Trump administration could increase revenues as much as $2trn over the ten-year period of time. So priming the pump in the short term leads to growth.
So you would have a bigger deficit, a stimulus, to prime the pump that would lead to faster growth?
So I happen to think that 3% is low. But you can’t do it if your companies are leaving the country because taxes are too high. Now, I’m going to do something there too. If our companies leave the country, number one they’re leaving for numerous reasons but one of the big reasons is the taxes are so high. When they leave—go back to trade for a second, when they leave the country, go to a certain country wherever it may be, and they fire all their workers in the United States and on the assumption they build cars or air conditioners or whatever they’re building, and they open a plant someplace else and then they send the air conditioner or the car into our country with no tax, that’s not going to happen anymore. They’re going to have a very large tax to pay, in the vicinity of 35%.
Now when you do that, number one they're not leaving the country anyway. So we’re not leaving. I don’t know if you saw what’s happening. Ford has announced massive expansions in the United States. General Motors cancelled a big plant in Mexico and a big plant in Europe. They’re all cancelling plans because I told them, I said…I get along with them great. But I said, “Look, we don’t mind if you leave the country. You can build all you want out of country, I hope you enjoy your plant. But when you build your car, you’re going to have a 35% tax when you bring it back in. And if your numbers work, we wish you well. But that’s what you’re going to have. You’re going to have a 35% tax.”
So I mean, I have, it has, I haven’t been given massive credit for it yet, but I have been given some because I just see polls out in Michigan and different places, that really are affected by this, have been unbelievable, you know, much bigger than election day. But that’s not a tax increase, that’s no tax. In other words, all you have to do is don’t leave and you won’t have a…but we’re bringing our taxes down so low that you won’t even need the barrier because the taxes are so low, that people are going to stay.
The other thing, just in case we…I believe it could be anywhere from $4trn to $5trn outside, you know don’t forget we’ve been talking about $2.5trn for four years now. I’ve been using $2.5trn, the same number we’ve all been using for years. Well, you know, it grows. I think it…I wouldn’t be surprised if it was $5trn but, you know, we’re close. We’re letting that money come back in. And that has two barriers which you have to watch. It’s got a barrier of the tax, which we will take care of. We’re going to make it 10%. Now it’s 35%...
Sorry, 10%? The repatriation taxes?
The repatriation. Inversion. The corporate inversions, which is a disaster, with the companies leaving. But they want to bring back their money. Number one, the tax is too high but the other thing that’s too high is the bureaucracy.
Mr Mnuchin: Correct.
President Trump: I have a friend who said even if you wanted to bring it back in you can’t because you have to go through so many papers, so many documents, so many…
Mr Mnuchin: We’re going to make it simple
President Trump: You have to do…Steve, they told me you’ve got to sign books and books of stuff, you pay millions of dollars in legal fees and they almost don’t allow you to bring it back in.
Can I ask you a question about the politics of tax?
It should be like one page.
The politics of this? Do you need to get Democratic support to get this tax plan passed?
Um. Little bit.
www.economist.com/...
Now this is pump-priming of a different sort...