Trump’s ignorance is costing the U.S. billion$ in foreign investment


The cult of Trump

❝ Beyond the cost of President Trump’s trade war with longtime US friends and rivals, his policy of economic nationalism has taken a toll in another important sphere: Net inward investment into the United States by multinational corporations—both foreign and American—has fallen almost to zero. As I pointed out in a posting in Foreign Affairs this month, this shift of corporate investment away from the United States will decrease long-term US income growth, reduce the number of well-paid jobs available, and accelerate the shift of global commerce away from the United States.

❝ A few months ago, I developed in Foreign Affairs the potential emergence of a post-American world economy resulting from Trump’s aggressive bilateral bullying and abandonment of the rules-based international economic order. Today this post-American economic world, one where all investment is more uncertain and politicized—because the US government acts toward businesses as any self-enriching autocracy would—is increasingly on its way. That is apparent in business decisions about large, long-term investments, such as the building of major production facilities; foreign takeovers of, and mergers with, US companies; and investment in research facilities and workers.

Any time I note an upcoming appearance by Adam Posen on Bloomberg TV I try to remember to set the DVR to record. Often, he’s on Tom Keene’s Surveillance early morning show. That’s early morning in NYC – 2 time zones ahead of northern New Mexico. Fortunately, the Bloomberg folks are pretty smart about recognizing demand for top-shelf economists and the analysis they provide – and snip and save those episodes for their app.

Playing the trading game is too much work for an old geek retiree like me. But, I never intend to stop learning about the world around us and he’s a helluva source on the economics side.

Fighting wildfires is becoming more and more expensive

❝ Just six months after the devastating Thomas Fire – the largest blaze in California’s history – was fully contained, the 2018 fire season is well under way. As of mid-July, large wildfires had already burned over 1 million acres in a dozen states. Through October, the National Interagency Fire Center predicts above-average wildfire activity in many regions, including the Northwest, Interior West and California.

Rising fire suppression costs over the past three decades have nearly destroyed the U.S. Forest Service’s budget. Overall funding for the agency, which does most federal firefighting, has been flat for decades, while fire suppression costs have grown dramatically.

❝ Earlier this year Congress passed a “fire funding fix” that changes the way in which the federal government will pay for large fires during expensive fire seasons. This is vital for helping to restore the Forest Service budget. But the funding fix doesn’t affect the factors that drive costs, such as climate trends and more people living in fire prone landscapes…

Why are costs increasing so dramatically? Many factors have come together to create a perfect storm. Climate change, past forest and fire management practices, housing development, increased focus on community protection and the professionalization of wildfire management are all driving up costs.

What can we expect as a response from a Congress that as presently constituted answers mostly to a base that wants fewer costs, no taxes and, of course, no responsibility for any environment?