Is Trump ‘Detoxing’ the Economy or Poisoning It?
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What are President Trump's economic goals?
In the last week or two, we've begun hearing something pretty new out of the Trump administration, which is that they are prepared to push the economy into a period of pain, maybe even a period of recession, in order to achieve their economic goals. But what are those goals? In our episode earlier in the week, we looked at the tariff policy very specifically and tried to understand what are they trying to do? And I think the problem with trying to see it that way is that the tariffs don't make that much economic sense because what they are pursuing is not, I think, best understood as a narrowly economic policy. It is some mixture of economics, of power politics, of
Why do Trump's tariffs seem economically illogical?
of maybe more traditional patronage. And it's not clear there is one framework here. Not clear, there is one way of understanding it. But some people are trying to figure out a framework. And so what does that look like? And how do you try to put all this together? My guest today is Jillian Tett. She's a economics columnist at the Financial Times and a member of their editorial board. And she's always had, to me, a very interesting approach to this because she doesn't come at it just from the perspective of economics. She's a trained PhD anthropologist, which I think is training useful for understanding the Trump administration and geopolitics right now. As always, my email is reclineshow at nytimes.com. Jillian Tett, welcome to the show.
Delighted to be with you.
So I think it's good to start here. Give me the best account you can give of what Donald Trump's economics team thinks they are doing. What is the grand theory of the promised land on the other side of all this turbulence, disturbance, possibly even recession, as Donald Trump just said, that they are risking?
Well, if you ask the team what they're doing, they will often revert to the slogan of make America great again. And that's not just a meme. It's also a guiding vision. And what they think that means is that they want to do a big reset for the global trading economic growth. financial and tech and military system and essentially ensure American supremacy and vibrancy for many years to come. The strategy to get there is really all about trying to move from what might be called a neoliberal mindset to move instead to what could be called a mercantilist mindset or a hegemonic power mindset. And that really is their vision for where they're going. And it affects how they see both trade and financial flows and tech.
What is a mercantilist hegemonic mindset?
It's all about power. And everything you should do will start with the recognition of who has power and who doesn't have power. So for them, it's really first and foremost about using every possible tool they can to bolster American power. The goal is to make America great again. The strategy is to reset the global financial and trading system. And the tactics are to use essentially threats, capricious, uncertain, bullying, tariffs, military power, all of those as ways of getting leverage to achieve that.
What is the Mar-a-Lago Accord?
You've written a couple of times about this idea that has become circulating called the Mar-a-Lago Accords. What is this Mar-a-Lago Accord?
Well, at the moment, we don't know exactly what the Mar-a-Lago Accord is. And I should stress that because it's still being thrashed out. It hasn't been announced. It's possible it may never be announced. But very broadly speaking, what they're seeking to do with the Mar-a-Lago Accord are two potentially quite contradictory things. On the one hand, they want to ensure that the dollar remains supreme as a global reserve currency and that the dollar-based financial system continues to dominate. And that's really important because when you look at what the source of American hegemonic power is today, it's not really manufacturing because that's with China that's got a stranglehold in so many parts of the supply chain.
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Chapters
7 chapters
1
What are President Trump's economic goals?
0:45–1:28
2
Why do Trump's tariffs seem economically illogical?
1:28–4:17
3
What is the Mar-a-Lago Accord?
4:17–7:26
4
Is there a coherent strategy behind Trump's economic policies?
7:26–15:52
5
How does cultural power influence Trump's policies?
15:52–22:22
6
What are the potential risks of Trump's economic approach?
22:22–26:53
7
How might Trump's economic policies affect the stock market?
26:53–1:01:03