Once again, we are the economic envy of the entire world. Donald Trump, July 27, 2018
The headlines over the weekend and reports from the White House were all about the roaring US economy. Everyone loves good news, and GOP cheerleaders were having a great time. I hate to spoil the party but there is nothing to celebrate, the US economy is weak and getting worse. Last Friday will be remembered as C-Day, the greatest presidential Con in history.
“Economy” is a name used to describe the commerce and overall health of a country. People living in countries with good economies are healthy and happy. Third World countries with poor economies are often ruled by corrupt dictators living in extravagant mansions, using military force to keep the people from revolting. The radicals are thrown in jail never to be seen again.
C-Day
The results for April, May and June 2018, measured by the Gross Domestic Product, were better than the results for the first quarter. Trump could not wait to claim victory and spread the news ahead of the markets. Trump said a “4.1 percent GDP growth was amazing,” and predicted sustained strong growth. “We’re going to go a lot higher,” he said. This may be his biggest lie and the most fraudulent. Trump has the power to destroy the U.S. economy.
GDP is the sum of all consumer spending, investments, all government spending minus taxes, and the value of net exports. GDP ignores the $985 billion U.S. deficit and the $22 trillion national debt. GDP is an 85-year-old metric. Like all economic indicators, it should be used with care by honest experts. Why would foreign investors choose the US when Trump lies and backtracks all his claims?
What really happened in Q2?
Increased spending and steel exports to avoid tariffs explains the high GDP for the second quarter, Q2. Low wages, part-time jobs, the opioid epidemic, detention centers and incarcerations, did not improve in Q2. Unattainable work requirements for Medicare and Food Stamps and eliminating environmental protections, have increased fear, economic inequality, and anxiety.
Free trade no tariffs
The U.S. technology transfer, intellectual property, and innovation review with China started mid-2017. A March 2018 report led to 25 percent tariffs on $50 billion worth of products, per year. This equals $12.5 billion per year in tariffs, all going to the U.S. Treasury and none for the patent holders, increasing the cost of living. Like the 2017 Trump Tax, trade tariffs will hurt the poor and middle class.
Eliminating emissions
Most industrial processes used worldwide were developed hundreds of years ago, without concern for greenhouse gas emissions. All chemical emissions, heat, steam, and anything down the drain or up in the air are different forms of waste, unwanted outputs, taking time and resources away from production. Redesigning dirty processes to eliminate waste and emissions reduces cost and increases quality and capacity.
Zero waste and emissions
Toyota Motors is the master of waste elimination, practiced every day by all associates using a continuous improvement process. Toyota USA shares their experience with many U.S. manufacturers, one of the hidden benefits of international trade.
Overproduction is the worst type of waste, along with transportation, leaks, and spills. Bulk production of oil and gas is wasteful. Underground storage is the result of overproduction. The 2015 Aliso Canyon California blowout caused the largest U.S. methane release in history.
Climate solutions
In the middle of the climate emergency a healthy economy is fundamental. Many billions of dollars are needed to restore and upgrade roads, bridges, and other infrastructure. Mississippi, for example, has more than 500 closed bridges with no funds for repairs.
Electric vehicles and distributed offshore wind and solar power generation are the low cost solutions to energy and transportation. Emission free processes, like concrete made without sand or cement, carbon-free hydrogen steel manufacturing, carbon-free aluminum smelting, and wastewater treatment without toxic chemicals, are available.
Enough is Enough
We must protect all life on Earth. No more wars, no more fossil fuels, and no more lies. We are running out of time.
Dr. Luis Contreras