An open question is how Trump supporters will respond, peacefully or not, when they start to realize that:
· Coal mining jobs are not coming back, period. At $3 per million British Thermal Unit, natural gas is 25 percent cheaper than coal, besides emitting half the amount of green house gasses. The era of coal is coming to an end.
· Fifty percent of the lower taxes, resulting from Trump’s tax plan, will go to the top 1 percent, plus the deduction for state and local taxes will be eliminated, leaving the lower and middle classes with nothing, or close to nothing, gained.
· As imperfect as Obamacare is, any alternative is likely to be more expensive and to cover fewer people. That is unless the government picks up the tap, or some of it, which is not very likely.
· As for Trump’s domestic energy adventure to happen, the cost of crude oil must go up by at least another 25 percent, to around $80/barrel, with substantially higher gasoline prices to follow.
· Any tariff on imported goods will be nothing more than an extra tax on consumption, and may disrupt the global supply chain, which again could result in mass layoffs at U.S. manufacturing plants. One small part, held up in a trade dispute, can halt assembly lines all over the country.
· U.S. corporations will continue offshore production as they see economic benefit in terms of supplying a global marketplace and spreading currency risks. Since winning the election, Trump has “talked up” the U.S. dollar by more than 10 percent, making U.S. products 10 percent more expensive than their Chinese and Mexican equivalents. Go figure.
· Like we saw it eight years ago, and readily admitted by Obama at the time, there are no shovel ready infrastructure projects. From beginning to finish, it takes 10 years to plan, project and build any stretch of highway, and 40 years to add a runway to an airport. Yes, these are actual and historic figures.
I’ll give it two years before people start realizing that they’ve been taken for a ride.
And then what?
Karsten Malmos
