Last week I attempted what some condemn as the “sanewashing” of the Trump administration’s international economic policies. In other words, I asked whether there might be logic and evidence underlying what members of his administration, notably Stephen Miran, chair of the council of economic advisers, argue.
Berkeley professor Brad DeLong counters that this is irrelevant: “To do deals, you need your counterparties to regard you as a deal-keeper. Donald Trump demonstrates, every day, that he is not.” I agree — and said so.
Yet, one can still ask whether significant policy issues can be seen here and, if so, what one might do about them. Thus, Scott Bessent, Treasury secretary, argued earlier this month that, in addition to providing global security, “The [US]?.?.?.?provides reserve assets, serves as a consumer of first and last resort, and absorbs excess supply in the face of insufficient demand in other country’s domestic models. This system is not sustainable.” Similarly, Miran argues the dollar has been chronically overvalued, which “has weighed heavily on the American manufacturing sector while benefiting financialized sectors of the economy” to the benefit of wealthier Americans.