The Fed did nothing yesterday. The stock market didn’t do anything, either.
Even Donald J Trump was remarkably quiet.
He was distracted from his usual whirl by a visit to honour the body of a Navy SEAL, Chief Petty Officer William ‘Ryan’ Owen, who got killed in a raid in Yemen.
On the campaign trail, candidate Trump threatened to exterminate the families of suspected terrorists as well as the terrorists themselves. Is this another promise fulfilled?
Dad — a US citizen — was ‘droned’ in 2011. His 16-year-old son was offed two weeks later. Now they got the daughter, too…with a bullet to the 8-year-old’s neck.
Trump’s critics howl and whine…
But here at the Diary, we eschew emotional reaction and quietly apply our revolutionary new formula.
Win-lose deals make us poorer…and less satisfied. Only win-win deals can make America great again and take us where we want to go.
What kind of deal was this? Some of the losses are obvious — Owen and apparently ‘dozens of civilians’.
The win? It is impossible to know in advance the ultimate costs and benefits of any decision like this.
The little girl killed by the US Navy may have grown up to be a Muslim Hitler.
But that might be true of any kid; should you murder them all, like King Herod, just to be safe?
Would you put Owen’s life and soul in jeopardy — asking him to kill innocent children (even as collateral damage) — just to save your own skin?
Wait… This is a moral question, isn’t it?
Maybe, but it’s an economic question, too…a question of risk/reward…investment/payoff. And it helps us understand why our formula is the only way to know if a policy decision will help us or hurt us.
Why does the heartland suffer?
The average American is on the losing end of too many drone attacks by the swamp critters. He loses. They win.
We know how to make America great again, too — drain the swamp and stop these win-lose deals, especially the counterfeit money flimflam.
We are, like, so far ahead of everybody else on this.
The Washington Post, for example, lists eight ways to track the president’s promises on the economy:
Manufacturing job growth… Rust Belt (the former industrial stronghold states around the Great Lakes) job growth…employment-to-population ratio…unemployment rates in the Rust Belt…wages of white male working class…poverty level by race and ethnicity…percent of population with ‘health’ insurance…US trade deficit with China and Mexico.
Well, guess what?
Those metrics are nearly useless. Some are ridiculous. So what if there are more jobs in the Rust Belt if they come at the cost of job losses elsewhere…or price hikes…or higher taxes?
Likewise, you could give everybody medical insurance tomorrow. But who would pay for it?
And the trade deficit? Is that good or bad? The numbers won’t tell you.
There is always collateral damage; there are always unforeseen consequences. In short, there is always the next chapter, which we haven’t read yet.
What good is it to kill terrorists, for example, if it makes it easier for al-Qaeda and ISIS to recruit more? (A lesson learned the hard way by the Brits in Northern Ireland after ‘Bloody Sunday’.)
What good is it to kill families of terrorists if we all go to hell for murdering children?
We are in over our heads, dear reader. We have no answer. So we swim back to where our toes can touch the bottom.
You can’t read tomorrow’s newspaper; you can’t know what waits for you in heaven or hell. You can only know what kind of deal is on offer today. If it involves force, fraud, or violence, it is a bad deal.
You know, too, that the more people are free to make win-win deals, the more satisfaction they get. That’s the remarkable elegance of our new formula.
You don’t have to know the future; you only have to know what kind of deal it is.
So how about Mr. Trump’s ‘border tax’ to force Mexicans to pay for his wall?
Win-win? Or win-lose?
That’s an easy one: Trade tariffs are never voluntary. The importer can’t bring in the products he wants to sell. The consumer can’t buy them.
Besides, if it didn’t work for Juan Perón and Cristina Kirchner in Argentina, why would it work in the US?
Yes, it will always benefit a few crony suppliers and their workers pulling strings and producing inferior products at superior prices at home. And there will always be a few politicians who garner votes by ‘saving’ jobs.
But everybody else is a loser.
Putting up Trump’s wall is clearly a win-lose, too.
People are forced to pay for something many — or most — of them don’t want.
The border tax merely shifts the payment system. Instead of paying for it with their tax revenues, US citizens pay with higher prices for Mexican imports.
Some people — who want to put up a wall at others’ expense — win. Everyone else loses.
Isn’t a wall good for everyone, since it keeps out illegal aliens?
Again, we can’t know the answer. Too many unforeseen consequences. Too much collateral damage…or benefit. Too much unknowable future.
Do the illegals cost us money? Or do they contribute to the real economy? Are they coming…or leaving? Will they invent things? Will they create new businesses?
Are they criminals, rapists, and drug addicts? Or are they less likely to commit crimes than native-born Americans?
Are illegals good… or bad?
We don’t know. All we know is what kind of deal it is. It’s win-lose. The swamp wins. You lose.
We have had two personal experiences — with an illegal alien and as an illegal alien.
Our ‘Confessions of an Illegal Alien’…tomorrow.
For Markets and Money, Australia