Trump’s First Year: Stocks Up, Regulations Down

Trump’s First Year: Stocks Up, Regulations Down

Certainly, President Trump is an imperfect human being. He comes off as a narcissistic bully and some of his many tweets are immature and politically naïve. He lacks his predecessor’s eloquence, as well as the political standing to command control of his party. And some of his ideas – such as a wall along the Mexican border – are just plain wrongheaded.

But if we were to judge the president based solely on his accomplishments, it’s been a successful first year. At the least, it’s been more successful than he receives credit for in the media.

We won’t go as far as the president and his staff, which published a lengthy list of first year accomplishments, but even The Los Angeles Times, which is not known for its support of the president, opined that, “President Trump’s end-of-year accomplishment list isn’t that skimpy.”

While giving much of the credit to his appointees and Congressional Republicans, The Times reported that President Trump’s accomplishments include, “A record number of judicial appointments, including a Supreme Court justice, the defeat of Islamic State, repeal of the Obamacare individual mandate, tax reform and major rollbacks of various regulations, from arctic drilling to net neutrality.”

It’s a stretch to say that the Trump administration has defeated ISIS, but, as The Hill reported, “Trump dealt major blows to the Islamic State in Iraq and Syria, forcing the terrorist group to retreat from its two self-declared capitals: Mosul and Raqqa, located in Iraq and Syria, respectively. Trump also expanded the military’s authority to carry out air strikes in the Middle East, a factor some experts credit for his administration’s progress against terrorism in the region.”

In spite of these and other accomplishments, President Trump’s popularity rating was a dismal 35% in December, while the average for U.S. presidents since 1938 is 53%, according to Gallup. That level of unpopularity persists, even though the National Federation of Independent Businesses’ Small Business Optimism Index is near an all-time high and consumer confidence is at its highest level in 17 years!

That President Trump really isn’t Darth Vader has not occurred to many Americans. Some, out of fear, took their money out of the stock market when President Trump was elected. As a result, they missed out on major gains, as the Dow Jones Industrial Average finished the year up a whopping 25.1%. And the gains came in spite of three interest rate hikes and excessively high stock valuations. 

Benefiting the U.S.

President Trump has many critics, particularly in the media, but if they were to view year one of President Trump objectively, they would have to concede that he has made changes and appointments that will benefit the country. If that’s too much of a concession, at least take note that we have not experienced Armageddon, as many expected.

The passage of tax reform is clearly his greatest legislative victory to date. The Tax Cuts and Jobs Act makes American businesses of all sizes more competitive by, among other things, reducing the world-high corporate tax rate of 35% to 21%. The lower rate is balanced to a degree by the elimination of many tax deductions, which often favor big and powerful businesses over smaller businesses.

At the same time that tax reform is lowering rates for most taxpayers, it is eliminating the unpopular individual mandate from the Affordable Care Act, which assessed a tax penalty on Americans who didn’t want to or couldn’t afford to buy health insurance.

Deregulation efforts are complementing tax reform. According to The Wall Street Journal, President Trump is “reining in and rolling back the regulatory state at a pace faster than even Ronald Reagan.”

Presidents Obama and Bush were heavy regulators. As we’ve reported, President Obama set a record by becoming the first president to approve 600 major rules (e.g., rules that each impose a cost of more $100 million).

One of President Trump’s first actions was to require that two existing regulations be rescinded for every new regulation. And his administration has more than met that requirement.

Neomi Rao, head of the White House Office of Information and Regulatory Affairs, reported in December that through Sept. 30 the Trump Administration had taken 67 deregulatory actions but only three new significant regulatory actions (a 22 to 1 ratio). She added that, since fall 2016, more than 1,500 planned regulatory actions have been withdrawn or delayed, while the agenda for fiscal year 2018 includes 448 deregulatory actions and 131 regulatory actions, a better than 3 to 1 ratio.

Trump officials are seeking to repeal portions of the voluminous Dodd-Frank financial regulations that it deems are holding back economic growth and to overturn major regulations that were implemented without Congressional approval, such as net neutrality rules and the Clean Power Plan, which created sweeping new environmental rules.

“Agencies are now expected to regulate only when explicitly authorized by law—and to follow the proper procedures,” according to Rao. “The same standards now apply to regulatory and deregulatory actions. If the government exercises its regulatory power, it should do so with fair notice and due process, and only upon a conclusion that the regulation is necessary and that the benefits of the regulation justify its costs.”

Whether or not you agree with regulatory intent, new regulations are typically costly to create and implement, and, by their nature, they limit our freedom. In a democracy, vast new regulations should not be created and imposed solely by non-elected bureaucrats.

“America First” Grows Up

On foreign policy, President Trump is taking a harder line than his predecessors, too. He’s announced that the U.S. will formally recognize Jerusalem as the capital of Israel and move its embassy there. He’s reversed course on Cuba, where President Obama lifted sanctions and travel restrictions. He’s agreed to sell Javelin antitank missiles to Ukraine, in defiance of the Putin regime.

And he’s pressed for stronger sanctions against North Korea. U.N. Ambassador Nikki Haley even gained a unanimous 15-0 vote from the notoriously anti-American U.N. Security Council for a new layer of sanctions against North Korea.

As the year ended, he delivered his National Security Strategy, Which led Foreign Policy to conclude that, “‘America First’ is officially all grown up.”

“The four pillars – protecting the American people/homeland, promoting prosperity, peace through strength, and advancing interests/values — could have been used by any president since Reagan,” according to Foreign Policy. “This is not a criticism. On the contrary, doing the opposite would be more susceptible to criticism; one of the major concerns about President Trump is that he has at times seemed so bent on breaking with establishment precedent that he has failed to appreciate just how much of what has made American great has been the produce of these core establishment ideas and institutions.”

Like every president who proceeded him, President Trump is imperfect. Granted, his flaws are more blatant than those of many other presidents, but America will survive the next three years. In fact, based on the first year of his administration, it’s likely to thrive.

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