I saw a severe problem brewing over the last 10 years.  It was apparent to me that during those years the idea that we were “recovering from recession” was suspect.

During the last 10 years the “participation index” dropped by 3%.  This means a lot of people simply gave up looking.  Also, statistics like the wealth of the middle class showed a precipitous decline and it didn’t recover.  Rich people wealth did recover fairly rapidly after this recession.

I predicted that unless we had significant new growth the US would experience a political upheaval.

A recent similar analysis by a luminary in studying recessions and head of a major hedge fund confirmed what I believed.  If we had another recession without changing this terrible situation a lot of people had gotten into that we would have 100 million people on the street homeless.

The wealth of the poor and middle class had been depleted.  Another recession would destroy all their savings and leave them on the street.  The US would become a 3rd world country overnight.   This was indeed a real concern.

The anxiety of the middle and poor classes was bubbling over in many ways.  Suicides were surging massively.  Drugs, riots, violence of all kinds rising.  More and more enmity between different groups.  The country was being driven to a precipice.

Donald Trump is what I call the quantum candidate.

Essentially DT represented the views of individuals who had been affected by the last 10 years actual experiences.  These people voted based on their experiences much like the effect of particles interact in a quantum world.  They essentially found a way to tunnel through the candidates and pick the candidate which could lead to the outcome to restore us to a lower anxiety state.  This is an explanation for the democratic political system.

We were on the precipice of a major disruption in the world.  With the collapse of the US middle class would have come a worldwide depression.  Undoubtedly this would be similar to the 1930s recession.  We need to rebuild the wealth of the middle class.  DT is essentially committed to that goal.  He does appear to be doing everything he can to achieve that.

He is putting in place new laws and changes that will encourage growth of business.  Business will be expected to hire more people.  Putting pressure on hiring people will increase pressure on wages.  Increasing wages will allow people to save more and to buy bigger houses.  Bigger houses will drive house prices up which is 80% of middle class wealth.  Their 401K plans will increase and suicides will decrease.  Anxiety will decrease.

Everything DT is doing can be understood by seeing this.  Reducing immigration is simply a matter of limiting the labor supply to force increased wages.  Removing illegal immigrants takes away low cost labor and forces employers to hire legal immigrants.  Lowering taxes on business and individuals will spur growth, make the US competitive and produce more jobs.

DT is also talking trade tariffs.  I think DT doesn’t want tariffs but realizes a major problem has happened with trade that is not understood by the elite who have run this country.  The idea that Reagan and many liberals have is that more trade and zero tariffs is best.

It can be argued that no tariff is better even if our trading partners impose tariffs and unfair trading practices but this is a long range argument.   China for instance steals $50 billion in IP from the US yearly.  It does not buy American goods and services or very very little.  I have seen this firsthand.

While it is true we get cheaper products even if they don’t buy our stuff the fact is that their products displace American workers who are supposed to get jobs in the growing industries because of growing trade.  However, when the trade is one way the US does not get the jobs that enable the people who lose jobs from the cheaper Chinese imports.

Thus we become hollowed out.  We are able to buy cheap goods and overall we benefit some but this misses a crucial short term problem.  The income from them buying our stuff doesn’t happen and thus we don’t replace the jobs and our people are struggling to cope with the change and to gain good jobs to replace.

We need to change this.  We cannot keep absorbing loss of jobs as other countries learn how to do this export only path and reap the benefits of trade without paying for the IP they steal or buying the services and goods America does produce that would enable us to provide more jobs.

Really the goal of Trump should be and I believe it is to force these countries to buy more American goods and services.  If they did this then tariffs would not be necessary.  Thus DT’s eventual goal is really to educate the world how to have a sustainable trade system.  This system must include safeguards that force a country to deal fairly.

Whether China is doing trade the way it is for political purposes to actually damage America or simply is uneducated about how to have a sustainable trading system in the world is unclear.  The former way is a way to war.  I assume that Chinese don’t want war with the west and simply need to be cajoled to be like the Japanese eventually did and the Koreans and to have a more equal trading relationship.

I realize DT himself sometimes goes off on other countries and their mimicking the Chinese way.  The Japanese used to be much worse.  Today Japan buys a lot of American products and services and the trade deficit is nowhere near where it was decades ago. China has to learn the same lesson.  We can have free trade and low tariffs world but it depends on countries not being abusive and biased.  We need reform and this is evident. DT is leading this rightly so.

If DT is successful after 8 years of his administration we hope that the middle class has seen enormous gains in its wealth and security.  We hope to see the US trading relationships worldwide much healthier and in balance.  We hope to see even the poor doing much better.  This is regardless of race or national origin.  We also hope to see the end of the illegal immigrant.   One way or another this problem must also be stopped.

Illegal Immigrants don’t add to America

Illegal immigrants need to be distinguished from legal immigrants.  There is a tendency by the supporters of illegal immigrants to conflate the two.

Illegal immigrants by their nature are illegal thus they live in fear everyday they will be deported.  Nothing will change that without making them legal or sending them away.  This represents a second class of American citizen and it is often overlooked how evil this aspect of illegal immigration is.

Illegal immigrants cannot participate in our tax system and can’t achieve at the same level as legal citizens.  They don’t have the paperwork and can’t get it.  They can’t start companies and generate massive jobs.  They don’t win Nobel prizes.  They can’t do simple things like buy health insurance in many cases or car insurance.  Basic necessities to guarantee that people are responsible.

There is also doubt that they are so “good” as represented.  25% of our federal prisons and 5-15% of state prisons are filled with illegal immigrants.  This is FAR above their percentage in the population.  They must commit more crime.  In fact, a recent more methodical study of this issue in Arizona showed what is pretty obvious based on the incarceration statistics.  Illegal immigrants are twice as likely to commit crime as citizens.  This includes violent crime.

There is no logical argument or argument why illegal immigrants should be allowed to stay or if allowed to stay should be made “legal” to the extent for instance that workers on worker visa’s have.  Many illegal immigrants due to their time working in America have become extremely important to our economy.  It is ludicrous to think that exporting all of them is beneficial either.  Many of these people are fine craftsmen and we would miss them hugely if they were all to leave.  So, a compromise needs to be met.

DT has suggested this as well.

 

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