Trump Is Doing What He Said He Would Do (People Should Have Listened)

The following is part of a post by economist Paul Krugman:

When democracies die, big business and wealthy individuals often play a crucial role in their demise. They provide a would-be strongman with financial support; their control of or influence over news media ensures that he receives favorable coverage, while his opponents are trashed. They do this because they expect to be rewarded with policies that favor their interests and imagine that they will in effect be shareholders in the new autocracy.

What comes next is familiar to anyone who studies history (which the oligarchs don’t.) Eventually it becomes clear that they don’t own the dictator they’ve helped install; he owns them. Maybe they’ll like some of his policies, maybe they won’t, but in any case they’re not in control — and they soon learn that criticizing the big man isn’t just fruitless, it’s dangerous.

In the past this script has typically taken a few years to play out, but this is the internet age, so right now in America the process seems to be taking only a few weeks.

Donald Trump’s decision to launch an all-out trade war, not with China, but with our neighbors and allies — who are gearing up for large-scale retaliation — probably isn’t the most important thing happening right now. I’ll talk in a minute about what is. But it has certainly come as a wake-up call for business.

It would be funny if it weren’t so serious. Actually it is funny if you’re into gallows humor. Trump spent the entire campaign proclaiming that he was a Tariff Man, promising high tariffs and asserting that we were somehow subsidizing Canada and Mexico. Yet businesses and bank analysts blithely assumed that he didn’t really mean it. On Inauguration Day he made a very specific promise: 25 percent tariffs on Canada and Mexico by Feb. 1. Yet the newsletter I receive from Goldman Sachs summarized the day with the headline “A More Benign Tone on Tariffs.” 

The question, however, is, what did they expect? The Wall Street Journal has spent decades promoting the economic ideas of charlatans and cranks; now it’s upset to find out that cranks are in full control, but they aren’t their cranks. And Trump spent the entire campaign signaling his intention to start a destructive trade war. It’s a bit late to be shocked, shocked that he meant what he said. . . .

The trade war, drastic as it is, isn’t the most important story right now. It takes second place to what looks like a quiet takeover of the machinery of government.

Here’s how it works: Scott Bessent, the Treasury secretary — whose selection was, financial types assured me, an indication that Trump wouldn’t go wild — has given associates of Elon Musk, who as far as we know aren’t even government employees let alone officials with the right security clearance, access to the computers at the Treasury department that control the federal government’s financial plumbing — that make payments to contractors, workers, everything.

This situation gives Musk’s minions the ability to download millions of Americans’ private information. But people who understand the system better than I do say that it also effectively gives them control of public spending. Congress may have passed a law mandating that money be spent for some public purpose; but Musk and company may simply, in effect, tell the system not to cut the checks.

If this is really the case, and serious people say that it is, we may already have experienced what amounts to a 21^st-century coup. There may not be tanks in the streets, but effective control of the government may already have slipped out of the hands of elected officials. . . .

All of this was entirely predictable. But there are none so blind as those who will not see.