This week in Trumponomics
As the March jobs report numbers highlight economic volatility, Yahoo Finance's Rick Newman discusses President Trump's federal response to the coronavirus and reveals the Trumpometer score for the week on Yahoo Finance Live.
Video transcript
MYLES UDLAND: As we do every week, we talk with Rick Newman about his Trump-o-meter score. That's his reading on the state of Donald Trump's economy. And-- and, Rick, when we started this project back in 2017, you know, we're looking at jobs numbers, we're looking at the stock market, cutting corporate taxes, growth here or slower growth there. I mean, there were things that were different. The trade war was certainly a different period in American economic history.
But compared to right now, I think 20-- late 2016 through 20-- early 2020, everything seemed kind of normal. Around the edges you had some interesting policies, but it was kind of a normal period. Now we are, of course, in uncharted waters, and the Trump-o-meter has been trying to adjust for that. So let's just kind of go through your thinking on how you're evaluating Donald Trump's economy right now that has kind of gone sideways on him and would have gone sideways on any president.
RICK NEWMAN: I think sideways is an understatement, Myles. If I had the world-famous Trump-- desktop Trump-o-meter next to me, I think it would be going haywire. I don't have it. It's locked up safely in our studio in Manhattan. But, you know, the big story this week in the economy, obviously employment. We've talked about that a lot today. Terrible news, and it's going to get even worse for April. I think there's something else we should-- we should take note of, which is the way-- the way President Trump is going about the federal response.
You know, he-- he basically has described the federal government as a backup to the states. I mean, he used that word "backup." He keeps saying, we're not an ordering clerk, and the states need to take care of themselves first. So Trump is applying his small government mentality to this crisis, which I think is exactly the wrong thing to do. And, you know, there are some other people who have some interesting ideas. So Andy Slavitt, he oversaw Medicare and Medicaid in the Obama administration.
He put out a 20-point plan for what he thinks the government should do, and he-- his idea is kind of the polar opposite of Trump. It is throw everything at the problem. Utilize stadiums and arenas and empty hotels as hospitals or help people with housing, all kinds of things to help people. Some would require congressional approval, but so what? The president would probably get it. If you say to yourself, oh, he's a Democrat, of course he wants to do more than Trump, look at Scott Gottlieb's path forward plan.
He-- he oversaw the FDA under Trump from 2017 to 2019. He's got this four-phase plan for getting back to normal. He calls it the "pathway back to normal." The American Enterprise Institute has published that. Again, it's the government doing lots and lots of things to solve this problem. And Trump is basically saying, here-- here in Washington, we're the last responders. If nobody else can get the job done, then come to us, and we'll see what we can do. I think that is exactly opposite. And for that reason, the Trump-o-meter, even though I don't have it here with me, I'm sorry, but once again, sad, the lowest rating.
MYLES UDLAND: So, Rick, to go back to that point about the way Trump frames the federal government and-- and what its role is and what its scope is, I-- I've been thinking about this a lot. It's-- it's almost like it's been-- even if Trump wanted to do a lot of things, there isn't even the infrastructure to-- to get a lot of that stuff done because-- and this isn't just a-- a Trump administration thing. I mean, you can go back basically six administrations in modern American history, the spread between, you know, the Reagan administration and Clinton and Obama and Bush, the-- the spread in how they thought about federal capacity is actually pretty narrow.
They all siphoned off a lot of responsibilities to the private sector. The problem is, the private sector has real constraints the federal government doesn't have. And so even if Trump wanted to, quote unquote, "unleash the full force of the federal government," or, you know, President Hillary Clinton wanted to do that, both presidents would be stuck looking at, like, wait, where'd all the stuff go? Because they've kind of systematically eliminated the power of the federal government for 30, 40 years.
RICK NEWMAN: Right. So, I mean, this is not simple. Solving this problem is not simple. But I would say what the government should be doing is building the infrastructure. If the infrastructure is not there, then frickin' build it right now. What Trump is doing is you can-- I mean, he's trying to harness the private sector. I mean, this would be appropriate in something that was not a national crisis with people dying every day and millions of people losing their jobs and thousands of businesses closing. This is the wrong time.
You know, even if you're a conservative, I mean, the conservative approach to government is limited government, keep the government out of people's lives, and reserve the government just for the things only the government can do when there are market failures. I mean, I think we're seeing by-- this is the definition of a market failure, what's happening here. We cannot-- people cannot-- businesses cannot even open. So even by-- to my mind-- conservative standards, this is where you would expect a-- an aggressive throw everything at the problem federal response, and we're not getting it.
You know, President Trump, he kind of keeps coming around to do what needs to be done, but late. You know, he was very late, six weeks or seven weeks late probably, just to even acknowledge the scale of the problem. You know, here's an example. I mean, even Dr. Fauci says, we need to close the whole country, not just-- not just have-- have closures in parts of the country because this is going to go everywhere. Trump won't do it. He's leaving that up to states and cities. He may eventually do it, but, you know, the time to do that was probably two weeks ago. And meanwhile, the virus spreads and the recession worsens and more people lose their jobs.
JEN ROGERS: Hey, Rick, now that he's been in sad for a while, what-- what does he need to do to get up? I mean, I know you said there's, like, a 20-point plan out there and stuff. I mean, do you like the things that he's done on, say, 3M with the masks? Do you-- is there something simple that would change his grade?
RICK NEWMAN: I like the Gottlieb plan, and I think anybody who has an interest in this should just go look at it. It's on the American Enterprises website, aei.org. Why doesn't the government have a plan like that, that says, here's how we identify the problem. We need, you know, here's-- here's the number of tests we need to roll out. Here's a timeline for rolling out the tests. You know, there-- I think the reason the Trump administration won't do things like that is because everything is driven by this need to escape blame or responsibility for anything.
A simple question to the-- to the Trump administration. Where is the plan? Let us-- we all want to see your plan for getting the country back to normal. Where is the plan? Your former FDA commissioner has a plan. Shouldn't the government have a plan? And they don't even have that. So you get the feeling that they're trying to avoid putting targets out there or any kind of timeline because then they can be held accountable against that timeline and it'd be said that we failed.
But in the meanwhile, this is just totally squishy. And, I mean, it just seems ridiculous that when you hear a governor say, we're competing against each other for ventilators and driving up the price. I mean, the-- the federal government should be now controlling the marketplace for ventilators and making sure that, you know, skyrocketing prices doesn't happen, for example. Just buy all the ventilators if that's what it takes. Again, this is not simple, but the-- but Washington can certainly do more than it's doing.
MYLES UDLAND: Lack of imagination, I think, in a number of areas.
