American presidents’ economic policies tend to take time, often a decade or more, to feed into and affect the business cycle. Lyndon Johnson’s decision to debt finance the Vietnam war to avoid unpopular tax increase led to stagflation a decade later. The impact of Ronald Reagan’s supply side revolution was felt most strongly in the investment surge in the late 1990s that ended only with the dot-com bust. Donald Trump’s impact on the economy, however, will prove to be much more immediate. His policies have both raised the risks of a new global recession while seriously weakening the government’s ability to deal with it when it comes.
The current recovery is the longest on record, but also one of the weakest. And as in the nature of the business cycle, the longer its expansion, the closer it is to the next downturn. Over the 2017 to 2018 period, the economy charged ahead on a sugar rush fueled by Trump’s corporate tax cut, a massive stimulus just as the economy was running close to Click here to read entire article