In an analysis of Donald Trump’s economic strategies, Professor James Feigenbaum from Utah State University asserts that Trump embodies a modern-day mercantilist. His approach centres around trade restrictions to bolster national wealth and has incited tensions with traditional allies through increased tariffs. Feigenbaum clarifies that this age-old economic theory prioritises accumulating money, a view which Trump reiterates in his belief that tariffs ensure economic fairness for the U.S.
Feigenbaum references the critical shift introduced by Adam Smith’s 1776 book, “The Wealth of Nations”, which framed national prosperity in terms of income rather than mere gold reserves. He underscores that true economic success should be gauged through gross domestic product (GDP), contrasting sharply with Trump’s mercantilist tendencies.
Critically, Feigenbaum expresses concern about the repercussions of Trump’s policies. He argues that extreme, unfounded measures, such as mass deportations, could precipitate a recession worse than the Great Recession. He contends that only American consumers bear the brunt of tariffs, countering the misconception that foreign nations absorb these costs.
Looking ahead, Feigenbaum warns of potential stagflation—a troubling mix of stagnant economic growth paired with inflation. He challenges Trump’s perception of the economy as a zero-sum game, stressing that this view could hinder overall prosperity.
A Utah State professor argues that Donald Trump’s policies reflect mercantilist principles, focusing on tariffs to protect national wealth. Feigenbaum critiques this outdated approach, emphasising that the modern economy should be measured by income rather than gold. He warns of severe economic repercussions, including stagflation, and challenges the zero-sum mentality underlying Trump’s view of trade.
In essence, Professor James Feigenbaum’s insights position Donald Trump’s trade policies as a resurgence of mercantilist thought, which prizes restrictive trade to enhance national wealth but overlooks the broader implications for economic growth. With potential risks of stagflation looming, Feigenbaum cautions against the simplistic notion that a nation’s prosperity must come at another’s expense, urging a more expansive understanding of wealth generation based on income and productivity.
Original Source: kbindependent.org
