Monday, September 3, 2018

Interview from the Archive: Was protectionism "a mean to an end for Trump"? Christopher Whalen says so.

Editor's note: This article was originally published on April 25, 2017.

Story by Joseph Ford Cotto

As always, there is a lot going on in Washington, DC nowadays. No small measure of it relates to money, but not necessarily campaign spending.

How Donald Trump and, to a lesser extent, his administrative personnel -- along with Republicans on Capitol Hill -- handle the economy will make or break this presidency's legacy. Trump promised a great deal to his supporters, and managed to unilaterally see through some of his pledges, but found congressional-slash-judicial opposition toward others.

Most intriguing is that Trump tied the seemingly non-fiscal matter of immigration to his economic platform. Foreign trade, while more relevant to national wages than border patrol hirings, has traditionally been in the realm of international policy. Trump broke from precedent by tying it to the average American's quality of life.

Politics have not been the same since, and it seems unlikely that they will revert to business-as-usual anytime in the foreseeable future. 

Christopher Whalen is a longtime observer of -- and participant in -- fiscal happenings.

Displaying Headshot_rcw.jpgHis publicity biography describes him as "the ultimate Wall Street insider who understands the intersection of politics and finance, and is known for telling his readers the truth.  He has worked in politics, at the Federal Reserve Bank of New York and as an investment banker for more than 30 years.  Considered one of the most incisive and thoughtful financial analysts on Wall Street, Christopher coverers a wide range of subjects from banking to housing to global economics and the Federal Reserve.  He is the author of three books Inflated (2010), Financial Stability (2014) and Ford Men (2017).  Christopher publishes the blog “Washington & Wall Street” and contributes to many other publications and appears in media outlets including CNBC, Bloomberg and The Wall Street Journal."

Whalen recently wrote Ford Men, which strives to tell the full story of how Henry Ford's family built the automotive empire we have all come to love (or hate). Whalen chatted with me about Trumponomics and Ford Men. Some of our discussion is included below.


Joseph Ford Cotto: For Ford Motors, which ultimately proved more essential: careful planning or good fortune?

Christopher Whalen: Good fortune clearly. Ford was fortunate to find investors after two previous business flops.  He was fortunate to associate with people like James Couzens and Charles Sorenson, who helped make Ford Motor an ongoing business enterprise. Had Ford not been funded the third time, people like the Dodge brothers, Fisher and many others in the Detroit community might well have dominated the scene.  

Cotto: More than anything else, why did protectionism propel Trump during the GOP primaries; events in which free marketeers once dominated?

Whalen: Being protectionist was a mean to an end for Trump.  I doubt he will actually pursue many of these threats. Look at China, the “currency manipulator,” but now an ally with goof chemistry.  Don’t listen to what Trump says, watch what he does.  

Cotto: Beyond any other factor, what motivated Henry Ford to propel his business interests?

Whalen: Henry Ford had a idea of cheap transpiration for the average American, a vision.  But that vision was not coupled to a disciplined business approach, although Ford is lionized as the great creator. Without the help of others, “Ford Men” we call them, none of this success would have occurred.  Henry Ford took credit for inventing the assembly line and raising wages, but in fact others propelled those events.

Cotto: During last year's general election, how did economic insecurity among the electorate allow Trump to transcend barriers typically placed in any Republican's direction?

Whalen: President Trump used social media and outrageous behavior to great effect. He managed to communicate to tradition Democratic constituencies while retaining a good chunk of Republicans.

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