Will President Trump really kill avocado toast?
Not a chance.
Trump is threatening economic chaos once again, this time as a tactic to stop a surge of migrants trying to enter the United States at legal points of entry along the U.S. border with Mexico.
This chaos strategy has become familiar: Trump threatens blunt-force measures to achieve some policy goal, insisting the harm caused to U.S. interests will ultimately be worth the outcome.
But time after time, the strategy fails. Trump’s trade wars with China and other countries are costing American businesses and consumers $3 billion in new taxes per month, while hurting American farmers and businesses getting cut out of foreign markets. If Trump ever gets a trade deal with China, he’ll declare it all worthwhile. But the trade war has depressed stocks for a year and some of the damage may be irreversible.
Shutting down the government for 35 days was supposed to be another sacrifice worth the outcome. But Americans overwhelmingly opposed the shutdown, and Trump ended it when air traffic controllers started to skip work, threatening airport closures. Trump ended up with nothing to show for the shutdown except a falling approval rating.
Trump faces the same lousy logic on shutting the southwest border, which would suspend trade with Mexico, the United States’ third-largest trading partner. American auto plants and many other manufacturers would run out of parts. Construction firms would run short of cement. And avocados would disappear from store shelves and restaurant menus, since Mexico supplies most of the U.S. stock at this time of year.
Trump’s tariff policy proves he is willing to cause diffuse harm to pockets of the economy, if he feels there’s something to gain. But there’s one thing he’s not willing to do: inflict a visible wound on the U.S. economy that’s tangible enough to send stocks lower. Trump has blinked time and time again when the stock market objects to his policies—most recently, when he let his March 1 deadline for a trade deal with China slide, without any sign of a deal on the horizon.
Trump has already laid the groundwork for backing off his border-shutdown threat. In a speech on April 2, he claimed that Mexico toughened up on migrants crossing its southern border headed for the United States, implying that his threat of a border shutdown got Mexico to act. Maybe, maybe not. The important thing is this fits the Trump formula for threatening mayhem, then claiming that the threat alone achieved the objective he was after. Mission accomplished.
After a modest surge in 2018, the economy is slowing, and Trump has less wiggle room than he once did to try risky economic policies. His 2020 reelection odds depend to a large extent on the economy, and one mistake now could linger long enough for voters to remember. If Trump understands anything, it’s survival. And he won’t risk that on a foolish border shutdown.
Confidential tip line: rickjnewman@yahoo.com. Encrypted communication available. Click here to get Rick’s stories by email.
Read more:
The Mueller probe was money well spent
“Country bumpkins:” 5 business problems with Trump’s Russia deal
Why voters will reject the “Green New Deal”
Voters are souring on “Medicare for all”
3 problems with Elizabeth Warren’s wealth tax
Rick Newman is the author of four books, including “Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter: @rickjnewman