Was June 1 the High Point of Trump’s Presidency?
Will history judge June 1 as a high point for the Trump administration? The unemployment rate hit a new 18-year record low of 3.8 percent. Inflation seems steady despite rising gas prices and interest rates. The U.S. economy keeps surging as businesses optimistically invest after being freed from a stranglehold of regulation. Businesses, along with most Americans, have more money to spend thanks to tax reform.
Other things are going well for President Donald Trump. The on-again, off-again North Korean summit may hang by a thread, but the active pre-meeting discussions have mitigated our national concern of nuclear war. And three Americans held prisoner by North Korea have returned home — met at Andrews Air Force Base by the president and first lady.
Those breathless cable “news” commentators who thought Trump had conspired with the Russians before the election have yet to see public evidence supporting this charge in the last year. They have shifted their cry to “obstruction of justice” — the same claims against President Richard Nixon — as if the outright deceit and cover-up of Nixon and his team somehow equates with President Trump’s efforts to end the absurdly lengthy investigatory cloud. The obstruction charge remains such a faint beacon of hope that it has not been waived by many Democratic legislators, including former (and wants to be again) House Speaker Nancy Pelosi.
President Trump may be mulling a pardon for Martha Stewart, less as a message to loyalists and more in spiritual kinship with Stewart as a talented doer. Stewart, despite an aggressive investigation, could not be charged with insider trading. Instead, they indicted and jailed her for obstructing justice for changing a subpoenaed calendar. Changing a calendar for Stewart seems like mulling or even actually firing people for Trump. In any case, it is hardly an impeachable offense, as it was his electable campaign promise taken from his TV show’s signature line.
President Trump had a great May and could have extended that success into June. The global business community was happier with the U.S. than with Europe, as every company with global contacts confronted the reality of a tough new EU privacy law: General Data Protection Regulation (GDPR). Non-complying businesses face penalties of up to four percent of revenue. The law is a big expansion of legal reach, requiring non-EU businesses to follow and change business lists, practices and marketing.
Paul Nemitz, the principal advisor for Directorate-General for Justice and Consumers of the European Commission, who said he was the one responsible for shaping the law, spoke gleefully at a conference I attended in The Hague in the Netherlands. He said John Perry Barlow’s 1996 Declaration of the Independence of Cyberspace — in which he declared the internet free from governments of the industrial world — is now officially “dead.” A polite Japanese delegate asked how it was fair for Europe to impose its cultural values on the world, and added that Japanese businesses were confused and struggling to comply. Nemitz said they could, so they did, and described how his next effort is to regulate artificial intelligence — before products can enter the EU marketplace.
Europe’s choking social regulation has not been a recipe for innovation in the digital age. The EU has 64 unicorns — or billion dollar startups. With a similar sized population and landmass, the U.S. has 321 unicorns. Europe is jealous, and now with tariffs, it also will be spurned. And despite the new artificial intelligence strategies that the EU and a few countries have recently announced, the undeniable contest for technology leadership is between the U.S and China.
But what does this have to do with President Trump? Sadly, almost nothing. Instead of taking the European Union to task for their continuous attacks on our crown jewel companies such as Google, Apple and Facebook, he has focused his attention on antagonizing our closest allies as threats to our national security. On June 1, the president imposed aluminum and steel tariffs on Canada, Mexico and the EU — and just days before, he reversed his decision to not put tariffs on $50 billion in goods from China. Tariffs put our economy and U.S. jobs at risk. More, trade wars taking aim at our friends and neighbors risk our global diplomatic standing and our national security.
President Trump should not only measure his success based on current key economic indicators, but also look to lessons of the past that illustrate the long-term effect of protectionist measures. He must act quickly to preserve our global lead in innovation, both from protectionism within and from overbroad regulations without. Doing so will help the U.S. continue to enjoy a booming economy and a return to economic prosperity.