Sunday School 7/29/18

Just a couple of classrooms today -- Fox News Sunday to hear from Steven Mnuchin, Trump's Treasury Secretary, and CNN's State of the Union, because Anthony Scaramucci.

First, Mnuchin. Wallace asked him if the report on the 2nd quarter GDP - 4.1% - was something that was sustainable, and if the president's suggestions that we could see 8% or 9% growth realistic.  Not so much, it seems.

Well, Chris, we've been very clear since the campaign, the president's economic plan has always consisted of tax reform, trade relief and regulatory relief and we said we're going to achieve 3% or higher sustained GDP, and that's where we are. The 4%, 4.1% was a terrific order, but we are very focused on the long-term sustained economic growth, which our plans have had. 

Wallace noted that the 2nd quarter was when farmers were pumping out exports in advance of the Trump tariffs and that the Federal Reserve is not so bullish on the growth, predicting we'd be back around 2% within two years. And, he talked about both Trump and Veep Mike Pence sticking their noses in the conversation about the Fed's intent to raise interest rates. Wallace wondered about whether the administration respects the Fed's independence.

Well, Chris, I think they do and we as an administration absolutely support the independence of the Fed and the president has made it clear that this is the Fed's decision. So, these are really more just comments saying as interest rates are going up, it's something that the president has a concern. But let me be clear, he respects the independence of the Fed, and the issue is the market expects interest rates to keep going up. So, the only question is how far, and for how long? And we think the Fed will be very careful in managing the economy.

They also talked about tech stocks, what with the Facebook and Twitter drops this week. Wallace wondered about investors souring on social media tech stocks, since they've been such big drivers of both economic growth and of the rise in the stock markets. Mnuchin pointed out that diversified portfolios are great investments and that

As you can see, the market is not efficient. The fact that you could have a one-day correction of these magnitudes just goes to show you that in the short term, the market is not necessarily efficient, but I'm not concerned about this at all. 

And, of course, they talked about trade, and agriculture. On that last part, Wallace pointed out previous comments made by Mnuchin that were against corporate welfare, and asked

So, when did handouts to farmers become strong, good, solid, conservative policy?

Mnuchin doesn't think the $12B bailout (bale-out, it's been called) is a handout.

So, it would be one thing if we were just subsidizing markets, and that's not what we are doing here. This is a -- this is a short-term solution to deal with the retaliatory tariffs where you have people who put tariffs, which, by the way are against WTO rules and unfair and targeting our farmers. So, we are sticking up for our farmers so they don't get hurt in these trade discussions. These are not long-term subsidies for the industry... the focus is trade, not aid...

Focus - that's a key word on which to segue to the conversation with The Mooch - because focus is something that seems missing in this interview. For example, Tapper asked if Scaramucci thought Michael Cohen was a liar, as Rudy Giuliani now says.

And so, when I said that, I meant that, because I - I had known Michael for 10 years, known the president for a very long time. And my- my guess what is that they were very loyal to each other. When your house gets raided and your apartment and your hotel room gets raided and you get jarred by the FBI, maybe that has changed now...

But look, at the end of the day, you're -- you're in the biggest aquarium in the world. The White House is literally like a fishbowl, and everybody's micro-analyzing every single thing that's happened to you in your life, which is one of the main reasons why people, Jake, don't run for office, because they don't like every single thing that they have done in their lives put on State of the Union. 

So -- so, here we are now. My - my guess is, is that this is a rift that will continue. I'm not exactly sure what the criminality is here. To me, it doesn't look like it's criminal,when I step  back and look at it and try to look at it objectively. And I think the president's probably very frustrated because he's got a great economic plan going. He's got great things going on, whether it's in North Korea or the potentiality for a deal with the EU now. And so this is one of those side-tracking things and I think it has to be very frustrating. 

So: is Michael Cohen a liar? Who the heck knows. The rest of the interview went similarly, as you might have expected.

See you around campus.