OPINION:
If the election were held on Valentine’s Day, President Trump would have good prospects, but next November the story may be different.
According to the most recent data, the economy has averaged 2.6 percent growth on his watch, and that’s decidedly better than the 2 percent accomplished by Presidents Bush and Obama. Unemployment is at levels not seen since the Nixon administration, and women, minorities and lower-income workers are making notable progress.
The president is celebrating triumphs: House passage of the U.S.-Mexico-Canada Free Trade Agreement (USMCA), a “phase one” trade deal with China that promises to boost exports and too often unappreciated gains in the judiciary.
Justice Brett Kavanaugh will likely shift the majority in the U.S. Supreme Court to a less expansive view of executive branch regulatory authority. His record indicates he is hardly hostile to consumer protection and measures to ensure a healthy environment. Nor does he oppose, as Democrats charged during his confirmation, the evolving consensus that accepts a woman’s right to reasonable access to abortion but with some reasonable limits on late-term procedures once fetuses are viable outside the womb.
Coupled with the large number of highly professional, constitutional federal district and appellate judges, President Trump has appointed, the Kavanaugh appointment should more effectively circumscribe the ability of federal agencies to extend burdensome rules on business beyond powers granted by Congress through legislation.
Near term, however, the Boeing 737 Max production slowdown could slice 0.5 percent off GDP growth for the yet-to-be-tallied fourth and first quarters — the impact on wages and the quality of jobs will be noticeable.
The pace of growth should recover somewhat in the spring, but as the Democratic and Republicans hold their conventions Mr. Trump won’t be able to brag on the economy quite like he did during the holidays. Unless he gets busy now on issues with traction for middle class voters.
Average family incomes adjusted for inflation are about where they stood in 1999, but for items the American families consider essential — health care, higher education, homes, new cars and child care — costs have risen much more than the general price level.
Middle-class families partially cope with the high fixed expenses by pushing debt on their children — student loans that now total $1.5 billion. Consequently, younger Americans are forced to delay marriage, children and home purchases.
In the State of the Union, the president should challenge Congress to take up a new middle-class agenda. A lot of it would be tough for Republicans to swallow, but Democrats who opposed him would be saying no to the young college graduates, women and suburban voters who gave them a House majority.
Initiate an infrastructure program to improve roads and mass transit, and bolster climate change abatement. Even if financed by higher gas taxes that would boost growth, wages and stock prices.
Permitting the states to purchase imported drugs and more transparency in pricing, as the Trump administration proposes, won’t do enough to change what most Americans pay. Instead, the president should get behind the plan endorsed by House Speaker Nancy Pelosi to benchmark drugs to European and Canadian prices.
At least initially, electric cars will be even more costly than the gas models those replace. Extending the average tax credit of $5,000 for the first 200,000 electric vehicles each manufacturer sells to every first-time purchaser of an electric car or truck — assembled in North America and meeting the USMCA trade content rules — would give the domestic battery and auto industries a huge boost.
Universities and private schools that sold young folks bogus curriculum with promises of good-paying jobs that only resulted in big debt should be brought to account. Their land and structures should be mortgaged through bonds to help young folks retire student loans.
Among the biggest barriers to building affordable homes is the cost of land. The president should assemble a bipartisan committee of governors to purpose model zoning regulations and push Congress to make federal funds for roads and mass transit contingent on adopting those.
Free market fundamentalism will not deliver a sustainable majority to Republicans any more than the Green New Deal or other Trojan horses for socialism will for Democrats. This is an era of measured, activist government.
It is critical that activism be pro-opportunity and middle class, not rooted in envy and the economics of failure. It’s up to the president to articulate the vision.
• Peter Morici, @pmorici1, is an economist and business professor at the University of Maryland, and a national columnist.
Please read our comment policy before commenting.