If you look at the rising stock markets or listen to President Donald Trump’s hyperbole, it may seem like the U.S. economy is not only healthy and growing, but poised to leap into a new age of heightened economic expansion and unending prosperity. Opportunities for a significant positive shift down the road do exist. But the reality now is that the U.S. is entering an economic minefield.
The number of potential threats to stability and growth are accumulating. And if the U.S. economy takes a fall, the global economy is sure to follow.
It’s not just that the Trump administration has launched a protectionist trade war, imposing the highest tariffs since the Great Depression, even though the general consensus among economists is that tariffs are harmful to the economy. After creating that new level of uncertainty, the president has engaged in a campaign to pressure the Federal Reserve, whose independence is crucial for the health of the economy, to obey his politically motivated wishes. Just as damaging was his decision to fire the independent head of a key data-gathering entity, the Bureau of Labor Statistics, and replace her with a fervent partisan.