When Trump was running against GOP opponents, he favored keeping the minimum wage where it is.  Then last Wednesday he seemed to come out in favor of raising it:

The billionaire businessman said he was studying the minimum wage issue and did not know if the current federal minimum wage of $7.25 per hour should be raised to the $15 per hour “living wage” advocated by Democratic presidential candidate Sen. Bernard Sanders.

Hillary Clinton, the likely Democratic nominee, has said that the federal minimum wage should be raised to as much as $12 per hour. . . .

 

Mr. Trump also predicted that he would win over supporters currently backing Mr. Sanders, a Vermont independent and self-described democratic socialist who has led a insurgent movement of young voters dissatisfied with the political system.

“I’m going to get a lot of his supporters,” said Mr. Trump.

Then today he came out for eliminating the Federal minimum wage, the exact same position as the New York Times held back in 1987.

Trump Casino:  You place you bets votes, and you take your chances.

HT:  Scott Freelander

At least I endorse her for voters living in purple states.  For those living in red and blue states, I recommend voting for Gary Johnson.  Since I live in Massachusetts, I plan to vote for Johnson.  He’s far and away the best choice, which was not as true 4 years ago. Clinton is worse than Obama (more authoritarian/militaristic), and of course Trump is infinitely worse than Romney.

In past elections, I always voted for Libertarian, and didn’t view the differences between the main parties as being all that important.  I pointed out that government grew faster under Bush than Clinton.  There were some differences, but no clear advantage to either party.  Many commenters (both progressive and libertarian) insisted that while that was true under Bush, the GOP was now much more the small government party, due to the ascent of the Tea Party.  With the rise of Trump, that idea no longer even passes the laugh test.  Trump may be the strongest supporter of big government that the GOP has ever nominated (with the possible exception of Nixon.)  I was completely wrong about Trump having “no chance”, but I was totally right about the GOP not really being the small government party.

Update:  PJ O’Rourke’s endorsement of Hillary is far better, as you’d expect.

The Trump phenomenon increasingly reminds me of the “cults” that were popular when I was younger.  Charismatic leaders like Reverend Moon and Lyndon Larouche had dedicated followers who blindly accepted anything they said.  (Are they still around?)  I’ve noticed that Trumpistas in the comment section now defend any statement, no matter how absurd. “Trump wants to default on the US national debt? Great idea!—Let me explain why.”

If I could have any job right now, I’d probably most enjoy being the marketing person for the Clinton campaign.  Where do you start?  Perhaps with commercials showing all of Trump’s bankruptcies, and then Trump saying that he wants to solve America’s problems by having the US reschedule its debt.  Hey, it worked for Greece!

But the Clinton people really need to be careful here, and hold some of their fire until after the convention.  Trump is rapidly becoming the laughing stock of politics, and there’s a danger that it could reach a sort of “Thomas Eagleton” tipping point before the convention.  Clinton needs to make sure Trump has the nomination in hand before tearing him to pieces.

PS. And now we discover that Trump supports a one time 14.25% wealth tax on the rich, another popular GOP idea. Seriously, even Bernie the Socialist Sanders didn’t go that far.  BTW,  “one time” taxes are a good indicator of corruption, of a banana republic-type policy regime. It’s time inconsistency on steroids. It’s all about making the Big Man look good for a few years, and let future generations suffer the consequences.  The intertemporal equivalent of “America First—and to hell with the rest of the world.”

PPS.  Of course I hope Clinton does not take my advice, and hits Trump so hard that he has to pull out before July.  But that’s not likely, as ambitious politicians tell themselves that any short-term damage to the country required to get elected is a price worth paying for all the good things they’ll do as President.  Clinton wants to win in a landslide, not a narrow victory over Paul Ryan.  That’s how FDR justified not helping Hoover in the banking crisis of 1932-33.  Taking office in the midst of a calamity gave FDR a free hand.

PPPS.  When Clinton does a terrible job, don’t blame me for endorsing her.  I warned you she is terrible.  Blame the GOP voters who picked Trump, instead of someone like Kasich, who has a big lead over Clinton in the polls.  The Trumpistas are going to allow a supremely unpopular Democrat to be elected (at least there’s a 75% chance they will.)

PPPPS.  I see that a majority of former GOP presidential candidates are not going to vote for Trump.  You know you’re in trouble when even most of your party leaders aren’t going to vote for you.

PPPPPS.  I like these recent comments by President Obama (at Howard University commencement):

There was also a call for young black graduates to put themselves in the minds of others, police officers who may have bias or “the middle-aged white guy” who “you may think has all the advantages, but over the last several decades has seen his world upended by economic and cultural and technological change and feels powerless to stop it.”

“You got to get in his head, too,” he said.

Amid an election that has seen millions of white Republican voters embrace Donald Trump’s populist message, Obama tried to offer a strategy.

“There’s been a trend around the country of trying to get colleges to disinvite speakers with a different point of view or disrupt a politician’s rally. Don’t do that. No matter how ridiculous or offensive.”

“My grandmother used to tell me, every time a fool speaks, they are just advertising their own ignorance.

“Let them talk.”

Yes, let Trump talk—the more, the better!

HT:  Foosion.

I wrote the previous post under the mistaken assumption that Trump is not a complete lunatic.  Mea culpa.  I assumed that when he talked about refinancing US debt at lower rates, he meant that as short term debt matured he’d replace it by issuing longer term debt.  I never even dreamed that he was talking about defaulting on the debt, and then refinancing at lower rates. (I’m sure lots of people will be anxious to lend us money at lower rates right after we default.)

WASHINGTON (AP) — In the event that the U.S. economy crashed, Donald Trump has floated a recovery plan based on his own experience with corporate bankruptcy: Pay America’s creditors less than full value on the U.S. Treasurys they hold.

Experts see it as a reckless idea that would send interest rates soaring, derail economic growth and undermine confidence in the world’s most trusted financial asset.

The presumptive Republican presidential nominee suggested in a phone interview Thursday with CNBC that he would stimulate growth through borrowing. If trouble arose, he added, he could get investors to accept reduced payments for their Treasury holdings.

Trump later clarified that comment to say he would offer to buy the bonds back at a discount from investors in hopes of refinancing them at lower rates.

“I would borrow, knowing that if the economy crashed, you could make a deal,” Trump told CNBC.

Such a move, never before attempted by the U.S. government, would likely spook investors whose trust in Treasury notes keeps global financial markets operating.

The need to refinance would likely cause interest rates to spike as investors demanded a greater return for the perceived risks of non-payment. More tax dollars would have to go toward repaying the debt. Many investors would shift their money elsewhere. And the economy could endure a traumatic blow.

“It seems Trump is planning to try to run the country like one of his failed business ventures, and that does not bode well,” said Megan Greene, chief economist at Manulife.

The move would also end a policy introduced during the presidency of George Washington — and celebrated in the Pulitzer Prize-winning Broadway musical “Hamilton”— to pay full face value on the debts incurred by the country. The government’s unfailing payments of its debt have long pleased investors and supported the economy because the country can borrow at lower rates than it otherwise could.

“Defaulting on our debt would cause creditors to rightly question the ‘full faith’ commitment we make,” said Tony Fratto, a former Treasury Department official in George W. Bush’s administration. “This isn’t a serious idea — it’s an insane idea.”

.  .  .

“It would make a bad situation worse and increase U.S. borrowing costs on its debt going forward because we would have lost our credit rating,” said Chad Stone, chief economist at the Center on Budget and Policy Priorities.

.  .  .

The yield on a 10-year Treasury note is about 1.8 percent, a figure that would shoot up if Trump pursued this strategy. This would cause debt payments to climb at a precarious moment for the federal budget when Social Security, Medicare and Medicaid costs will likely increase the need to borrow.

“There is no upside,” said Douglas Holtz-Eakin, an economist and president of the conservative American Action Forum. “It’s a false hope.”

This is my favorite part:

“I would borrow, knowing that if the economy crashed, you could make a deal,” Trump told CNBC.

Trump’s an expert in running businesses through bankruptcy, and I’m sure he’ll do fine when the US government goes into Chapter 11.  Is Washington DC like Texas, where you get to keep the (White) House after bankruptcy?

PS.  I was also wrong when I mocked his claim that he’d get rid of the entire national debt in 8 years.  I never contemplated the default scenario.

Here’s MarketWatch:

Presumptive Republican presidential nominee Donald Trump on Thursday positioned himself on the far left of the political spectrum on fiscal issues, coming out for low interest rates, against a strong dollar and a more aggressive managing of U.S. debt.

In a wide-ranging phone conversation with CNBC, Trump said he would replace Federal Reserve Chairwoman Janet Yellen when her term expired, though he didn’t really offer up any criticism of her.

“I have nothing against Janet Yellen whatsoever, she’s very capable person. But she’s not a Republican,” Trump said. “When her time is up I would most likely replace because of the fact it would be appropriate.

“She is a low interest rate person, she’s always been a low-interest-rate person, and let’s be honest, I’m a low-interest-rate person,” Trump added.

Translation:  Yellen’s fine, but she wouldn’t kowtow to Trump in quite the same way that Burns was Nixon’s lapdog.  Let’s give Trump credit for being honest.  The only time I believe what Trump says is when he acknowledges his own corruption. Ever since 1980, Presidents have been willing to reappoint Fed chairs that were first picked by the opposing party.  Now Trump wants to end that.  Of course the other amusing aspect of this is Trump’s assumption that the sort of “Republicans” who are distinguished enough to be approved by the Senate are also economists who favor keeping rates low, as a way of holding down the cost of Treasury debt.  I’d love to see the list.  Hasn’t Mr. Burns passed away?

Trump also fretted about the impact on the U.S. debt if rates were to climb.

“I am the king of debt, I love playing with it, but now we’re talking about something very, very fragile,” he said.

One thing Trump advocated that the U.S. Treasury has resisted is a more active management of the debt. The U.S. Treasury hasn’t taken advantage of current low interest rates to issue more longer-term debt.

“I think there are times for us to refinance debt with longer term, we owe so much money,” Trump said.

While at times Trump seemed to link a conversation of refinancing with a situation where “the bubble popped” — at one point even suggesting a buyback of U.S. debt — he also made clear that he wanted to refinance now, to rebuild infrastructure.

When pointed out that the current Republican-led Congress has resisted calls to spend more on infrastructure, Trump said his expertise in that area could change minds.

Yes, when people discover Trump’s “expertise” some minds will change.

I don’t think any of this necessarily means anything, we won’t know what Trump plans to do until he becomes President.  I merely report the news for entertainment value. Some commenters pointed out that Trump favors easy money right now. That’s fine, but Presidents don’t determine monetary policy, they determine whether monetary policy will be politicized.  Nixon/Burns might be a good comparison for Trump, except that Nixon was far smarter, and also had a more pleasant personality.

PS.  No, if Trump came out favoring NGDPLT tomorrow I would not change my view of him.  It’s not about his views on this or that issue, it’s about what he is.  He’s ignorant, he’s a bully, a demagogue, a nationalist, a bigot, a xenophobe, a sexist, a buffoon.  He’s trying to remake the GOP in his image. NGDPLT would not change any of that.

You say Hitler was a vegetarian?  That’s nice, but I’m not changing my opinion of him.

(Of course I’m not equating Trump and Hitler, which would be ridiculous.)

PS.  It’s on, the race brought to you by Rush, Fox and Drudge.  The candidate who really likes Nancy Pelosi vs. the candidate who really likes Pelosi, except for the fact that she didn’t impeach Bush.

Cardiff Garcia quotes from a recent report by James Sweeney at Credit Suisse:

Many commentators point to high debt levels as a major driver of the [2008] crisis. However, high debt levels signal vulnerability, not imminent crisis. Crisis occurs when highly leveraged entities suddenly cannot service their debts. This is most likely when nominal growth suddenly slumps, or when asset prices fall sharply.

Of course, those two things often happen together. And what’s most likely before a sharp decline in nominal growth and asset prices is a boom in both.  .  .  .

We believe policymakers are so scarred by the events of 2008 that they live in constant fear of anything resembling a recurrence. The simplest way to prevent recurrence has little to do with achieving 2% inflation and much to do with minimizing the variance of nominal growth, preferably while maintaining full employment.

Macroprudential policy and financial stability monitoring may help with these goals, but ultimately monetary policy is the tool most likely to prevent large cyclical swings in nominal growth.

We’re winning.