President Trump's polls show that the issue that voters most trust him on is the economy. But on Wednesday, Politico reported that Trump and his team have been quietly prepping donors, other key Republican power brokers and members of the GOP elite for a mild downturn between now and the election, something that economists believe to be increasingly likely.
According to Politico, Trump and his aides are aware that his biggest selling point heading into 2020 is the economy. But now that he's gotten drawn in to this trade war with Beijing, Trump needs to find a way to prepare people for a mild or moderate recession as a matter of course, to ensure that his reputation as a businessman and as a populist who puts the economy first isn't tarnished.
But without control of the House, the administration is examining its limited options to shore up the economy or assuage voters' concerns if a recession arrives soon than economists expect. President Trump's attacks on the Fed have worked so far, but whether the central bank delivers the 2-3 more cuts that markets are pricing in remains to be seen. And those reports about a payroll tax cut and shaving another few points off the corporate rate represent serious policy considerations. Trump famously said he's been behind payroll tax cuts "for a long time."
Then, there's the trade war.
The administration is also urging the Federal Reserve to cut interest rates sharply, a move Trump has long sought in his public attacks on the central bank, and it is pursuing a trade deal with China amid various tariffs that some businesses say are posing substantial economic risks.
"The only thing they have in their control is China and putting out regulatory rules," said one former senior administration official. "Beyond that, there is very little that they can do - but that does not mean people are not brainstorming options."
The White House has dedicated itself to promoting its economic narrative, with Larry Kudlow and other economic advisors hopping on calls with donors and interest groups.
The White House spent Tuesday selling its happy economic message. Top economic adviser Larry Kudlow hosted two calls with local and state officials and conservative groups to offer his own analysis and assurances, discussions that one White House official said had been planned for several weeks. Officials also reached out to business groups with a message that included stressing the stock market‘s resilience.
The president is intent on convincing voters that the economy is in fine shape because he knows voters often cast ballots based on how they feel at the time of the election about their own economic situation.
Because if there's anything Trump does understand about the 2020 vote, it's that people are going to decide whether to give him another term based on how they feel. So he's deployed all of his people to get out there and talk about the economy.
"People do not vote on numbers. They vote on whether they feel good, and the president understands that. He is selling the feeling," a second White House adviser said. "It is like any other sales pitch: He is constantly trying to play off people’s feelings and emotions on the economy."
He’s not the only one. Kudlow, counselor to the president Kellyanne Conway and deputy White House press secretary Hogan Gidley all appeared on TV over the past few days to deliver the administration’s upbeat, public-facing message, while Vice President Mike Pence spoke to the Detroit Economic Club on Monday to tout the administration’s record featuring low unemployment and healthy wage growth.
"Despite the irresponsible rhetoric of many in the mainstream media, the American economy is strong, and the U.S. economic outlook remains strong as well," Pence said in Detroit. "Last week, despite some volatility in global markets, leading retailers also reported strong sales and earnings, and consumer spending posted its strongest reading since March."
There's definitely more than a little truth in Trump saying that his life would be a lot easier if he hadn't picked a fight with China.
Trump spent Tuesday stridently defending his administration’s trade standoff with China, which many economic experts and Republicans pinpoint as the main driver of any U.S. economic troubles.
"You should be happy that I'm fighting this battle, because somebody has to do it. We couldn't let this go. I don't even think it's sustainable to let go on what was happening," Trump told reporters as he detailed the way China steals U.S. intellectual property and argued none of his presidential predecessors were willing to confront China as he has.
"My life would be a lot easier if I didn't take China on. But I like doing it because I have to do it. And we're getting great help. China's had the worst year they've had in 27 years, and a lot of people saying the worst year they've had in 54 years," he added.
And if the economy does worsen, Trump has already lined up scapegoats: Jerome Powell, the media, Democrats, Europe, China - the list goes on.
Even in his latest tweet.
The Fake News LameStream Media is doing everything possible the “create” a U.S. recession, even though the numbers & facts are working totally in the opposite direction. They would be willing to hurt many people, but that doesn’t matter to them. Our Economy is sooo strong, sorry!— Donald J. Trump (@realDonaldTrump) August 21, 2019