Editorial: Trump in Detroit offers solid economic plan
Donald Trump’s attempt to transform his sputtering presidential campaign with a major economic address in Detroit Monday a heartening success to his GOP supporters and even to party skeptics. With the exception of a couple of hard left turns, the speech articulated an agenda the Republican establishment has been pushing for years.
Trump, who remained admirably calm in the face of serial interruptions by hecklers, kept to his message, and showed all the signs of a candidate who is heeding the warnings that unscripted and ill-considered remarks are destroying his candidacy.
He toned down the bombast and bravado, and delivered to the mostly business crowd at the Detroit Economic Club luncheon the message they wanted to hear: cutting taxes and reducing regulations will invigorate the economy and put people back to work.
There were no big, new ideas offered. Rather, Trump borrowed heavily from House Speaker Paul Ryan, with whom he’s had an uneasy relationship, and other GOP reformers.
He promised to cut the number of tax brackets to three from seven, and make the tax code simpler. That was a centerpiece of the reforms presented by retired Rep. Dave Camp, R-Midland, and it would work to both charge the economy and boost tax revenues through growth and more consistent compliance.
Trump proposed a top-to-bottom review of the regulatory structure, including the financial rules put in place after the 2008 crash and the emissions and labor mandates enacted by the Obama administration largely through executive orders and agency rule-making.
Although the current recovery is admirable for its duration, it has been tepid in its strength. Obama will likely end his tenure as the only president in modern history to not achieve a single quarter of 3 percent or higher economic growth.
Much of the blame falls on the regulatory shackles his administration has placed on the economy. The Environmental Protection Agency, for example, is using Obama’s Clean Power Plan to force the closing of coal-fired power plants, driving up energy costs and killing jobs without — by its own admission — delivering significant relief from global warming.
Trump pledged to end the double taxation on overseas profits of U.S.-based international corporations. Currently, $2.1 trillion in overseas earnings that should be invested in America are sitting in foreign banks because of a short-sighted tax code. Obama has tried to use penalties to keep corporations from moving their headquarters overseas to avoid the repatriation tax, but Trump’s proposal to let the money come home tax free would work much better.
Likewise, through two administrations both Republicans and Democrats have agreed that at 35 percent, America’s industrial world-leading corporate income tax is too high. But nothing’s been done. Trump proposes to take it to 15 percent, a far more competitive rate.
That’s the good stuff, and Trump should have left it at that. Instead, he again went after trade agreements, saying he would rewrite NAFTA, get tough on China, kill the Trans-Pacific Partnership, and impose tariffs and other penalties on trading partners who don’t play fair. He said his mantra would be “Americanism, not globalism.”
That may sound good to those convinced the global economy is stealing their jobs. But protectionism will trigger trade wars that will choke off growth and throw the U.S. economy into recession.
It’s also concerning that Trump decided to beat Hillary Clinton at her own game, seeing her plan to use tax credits to cap child care expenses at 10 percent of household income and raising it to cover all child care costs for everyone. Like Clinton, he didn’t offer a plan to pay for it. With the national debt still rising, this is not a time to put more entitlement spending on the credit card.
Trump used Detroit as an example of failed Democratic policies, without acknowledging that the auto bailout implemented by the Obama administration helped trigger the industry’s tremendous rebound. And he missed a chance in Detroit to talk about his plans for making sure America wins the competition to become the world mobility leader.
But over all, it was a solid plan, and its delivery provides Trump with a map for bringing a derailed presidential campaign back on track.