Howes: Trump's case for re-election hinges on economics
It must be an election year. Right on cue, the trade wars are coming to an end.
On Wednesday, President Donald Trump signed what he calls “Phase One” in a massive trade deal with China. On Thursday, he signed the rewrite of the North American Free Trade Agreement – all of it as the Senate prepared to begin its trial of the third impeached president in American history.
Trade wars? What job-killing, price-increasing, alliance-destabilizing trade wars? In ceremonies scheduled to blunt impeachment developments, Trump produced tangible results likely to quicken the country’s economic metabolism in the coming months – which is precisely the point.
Consider the headlines on the day opening the Senate trial: the S&P 500 topped 3,300 for the first time. The market value of Google’s parent company topped one trillion dollars for the first time. And the so-called “pick-up truck indicator” suggests the economy is strong.
This is political counter-programming 101. Democrats give moderate, anti-tariff House members a win to gain their impeachment votes. And Senate Republicans join the president to get the potent economic wins of new trade deals and renewed confidence among the jittery investor class.
That means two of the biggest burdens weighing on the economic outlook are poised to recede … just in time for the 2020 presidential race to heat up amid an impeachment trial. You know, the one that’s not exactly driving outraged Americans into streets around the country, much less the White House.
We’ve never been here before. An impeached president is eager to run for his second term as the Democrats scramble to decide who will oppose him. And instead of spiraling downward in a metaphoric reflection of the predicament consuming the Trump presidency, the economy is showing unmistakable signs of resilience.
Racking up wins that buoy the economy, fatten paychecks, and juice stock markets are critical components of Trump’s re-election campaign. Those and your 401(k) balance. They’re his most effective defense against impeachment and the steady drip-drip of more evidence arguably damaging to the president.
Trump is widely expected to be acquitted by the Republican Senate. Meaning his case for re-election hinges on economics – unemployment at 50-year lows, home prices returning to pre-Great Recession levels, and manufacturing recovering from its tariff-induced slowdown.
Business? It gets more certainty, less of the anxiety produced by Trump’s negotiation-by-tweet, and who knows how many, if any, jobs repatriated back to the U.S.
Under the NAFTA replacement, vehicles assembled in North America will be required to certify higher regional content to avoid duties. Under the first trade deal with China, American companies will get more access to China’s vast market. American farmers will sell more product there, and China will buy $200 billion in American goods by 2021, producing a U.S. export boom just in time for Trump’s re-election run.
This is no coincidence, because there are none in politics. It’s a bid to turn a bitter reckoning shared with only two previous presidents into a political victory called re-election.