A new analysis concludes Donald Trump's economic proposals, taken at face value, could produce a prolonged recession and heavy job losses that would fall hardest on low- and middle-income workers. The Moody's Analytics report, which a person close to the Trump campaign strongly disputed, is the first that attempts to quantify the cumulative economic benefits and costs of Mr. Trump's proposals on taxes, trade, immigration and spending. It determines that full adoption of those policies would sharply reduce economic output during his first term and reduce employment by 3.5 million jobs. Under almost any scenario, the report says, "the U.S. economy will be more isolated and diminished."
Hillary Clinton recently delivered a brutal speech condemning Donald Trump's views on foreign policy, exposing the Republican presidential hopeful as an untrustworthy and incompetent fraud. Today, she's reportedly going to take another swing, this time hammering the presumptive GOP nominee over economic policy.
But before considering Clinton's indictment, it's worth appreciating what independent economic analysts are saying about Trump's economic agenda. The Wall Street Journal reported yesterday:
The report is available in its entirety here (pdf). Were it not for Trump's campaign turmoil and anemic fundraising, it's likely this scathing analysis would have been pretty big news yesterday.
While Trump hasn't gone into any real detail on his economic plans, the New York Republican has sketched out a broad outline of massive tax cuts, deep reductions in public investment, and a possible trade war with China. In fact, Trump's exact words last month were, "Who the hell cares if there's a trade war?"
As it turns out, economists care quite a bit. This new analysis found that Trump's approach to trade would contribute to a sharp economic downturn.
Making matters worse, the WSJ article added, "On immigration, Moody's estimates that a crackdown on illegal immigration through forced deportations would reduce slack in the labor force but also leave more positions unfilled, particularly in industries such as agriculture where native-born workers have been reluctant to seek work even at modestly higher wages. Labor shortages in those industries could prompt job losses in upstream and downstream industries and also boost inflation as labor costs run higher, the report said."
I imagine Republicans will complain that the report's lead author is economist Mark Zandi, who has donated to the Clinton campaign. Let's not forget, however, that Zandi, who has an excellent track record, also served as an adviser to John McCain's 2008 campaign.
What's more, Zandi was one of four Moody's economists who prepared this analysis.