capitol hill

Is the U.S. heading for economic suicide?

Trade policy and tax reform are front-burner issues. Can we make the decisions and changes necessary to turn our economy around?

The two big issues for agriculture as far as Washington, D.C.  is concerned remains trade and tax reform. There are a lot of other issues on Congress’ plate, from health care to re-invigorating the energy industry, but the items that are on the front burner remain trade and tax reform.

It is amazing that we are coming off the lowest decade in history in terms of GDP growth, even worse than the decade of the great depression! In part it explains why the populist message has had such receptive ears, and why isolationism and protectionism are back in vogue.

We are in a precarious situation. We no longer can prime the pump with spending, as the deficit has grown to the point where we can’t maintain our investments or even pay for the commitments we have already made. Essentially, by any economic metric, the prospects for the future look dismal relative to any time that anyone can remember.

However, there is still little incentive by our politicians to make the changes that are necessary. Even the tax reforms that are being proposed are vastly different than the tax reform packages that have been proposed in the past. Our debt and our spending almost preclude substantive cuts; we simply have boxed ourselves in. Our options are becoming limited.

The same goes with trade. The Trans Pacific Partnership is moving forward, Mexico and Canada are busy trying to prepare for changes in NAFTA, and the clock is ticking to see if we are able to negotiate more favorable bilateral agreements or if we simply are going to find ourselves continuing to be locked out of vital markets. 

The pressure on the Trump administration and Congress is enormous. We are still able to implement mitigation strategies and change the trajectory and course we are on, but we are running out of time.

The way the establishment on both sides has responded makes it clear that change is going to be a very difficult thing to implement. The Trump and Bernie revolutions may be a little off base from a policy standpoint, but what we found is that they have not been able to stop the establishment.

Perhaps we are overestimating the desire for change. Perhaps the only reason that either one enjoyed the success they did was the fact that they were running against Hillary, and that is more reflective of common sense than a revolution. 

The opinions of Troy Marshall are not necessarily those of beefmagazine.com and Farm Progress.

TAGS: Exports
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