After the Conventions, 1.2 Percent Growth Means Hillary Is In Trouble

The Tempest by James Henry Nixon
The Tempest by James Henry Nixon

The splendid national political conventions are over. These inevitably put one in mind of The Tempest:

Our revels now are ended. These our actors,
As I foretold you, were all spirits and
Are melted into air, into thin air:
And, like the baseless fabric of this vision,
The cloud-capp’d towers, the gorgeous palaces,
The solemn temples, the great globe itself,
Yea, all which it inherit, shall dissolve
And, like this insubstantial pageant faded,
Leave not a rack behind. We are such stuff
As dreams are made on, and our little life
Is rounded with a sleep.

We awaken from Hillary’s stirring acceptance speech to discover that The Washington Post reports the second quarter growth rate at 1.2 percent, half of analysts’ expectations.

Note to Self:

2.4 percent is disappointing.
1.2 percent foretells probable political catastrophe for the incumbent party.
(Meaning Hillary.)

Consider the implications of The New York Review of Books’ Michael Tomasky’s recent observation:

There’s no disputing the fact that, absent a major event like a terrorist attack or a legal indictment, the economy is the most important factor in any presidential election. More specifically, as John Sides and Lynn Vavreck argue in The Gamble, it’s the economic conditions that obtain in the last few months or perhaps the last year before the voting.

Tomasky is a principled “until the last dog dies” Hillary loyalist, appalled by Trump (as, less so, by Sanders). Yet also he is one of the most honest and rigorous political analysts at work, unblinded by his own neoliberal preferences. A truth teller.

The new economic numbers cannot possibly represent good news for Team Clinton and the members of her camarilla. We now bid a fond farewell to the baseless fabric of this vision, the cloud-capp’d towers, the gorgeous palaces, the solemn temples of our respective conventions. Back to “reality” (such as it is).

As I elsewhere will reveal, I put Hillary Clinton’s beautiful acceptance speech — a speech that touched, moved, and inspired me — into my Secret Political Decoder Ring. It disturbed me to find that what it turned out she really was saying: “I will tax the American lemon until its pips squeak.”

Americans for Tax Reform has begun its own process of decoding Hillary and is sharing the Full List of Hillary’s Planned Tax Hikes:

Hillary Clinton has made clear she intends to dramatically raise taxes on the American people if elected. She has proposed an income tax increase, a business tax increase, a death tax increase, a capital gains tax increase, a tax on stock trading, an “Exit Tax” and more (see below). Her planned net tax increase on the American people is at least $1 trillion over ten years, based on her campaign’s own figures.

Hillary has endorsed several tax increases on middle income Americans, despite her pledge not to raise taxes on any American making less than $250,000. She has said she would be fine with a payroll tax hike on all Americans, she has endorsed a steep soda tax, endorsed a 25% national gun tax, and most recently, her campaign manager John Podesta said she would be open to a carbon tax. It’s no wonder that when asked by ABC’s George Stephanopoulos if her pledge was a “rock-solid” promise, she slipped and said the pledge was merely a “goal.” In other words, she’s going to raise taxes on middle income Americans.

To pivot from Shakespeare to Yeats, Hillary finds her candidacy “fastened to a dying animal” of the sputtering Obama economy. Whatever virtues, real or imagined, of imposing a trillion dollar tax increase on the American economy, few still argue with a straight face, and even fewer voters believe, that proposing or implementing that will improve economic conditions.

Doubling down on social justice themes and programs — rather than pulling a “Nixon to China” and emphasizing policies calculated and proven (by her own husband!) to ignite economic growth and upward mobility — does not bode well for Mrs. Clinton’s prospects for victory in November. That said, now that the pageant has faded perhaps Hillary Clinton will pivot to the middle, and to the real deal: free market policies that the voters recognize will lead to equitable prosperity.

Ralph Benko, internationally published weekly columnist, co-author of The 21st Century Gold Standard, lead co-editor of the Gerald Malsbary translation from Latin to English of Copernicus’s Essay on Money, is American Principles Project’s Senior Advisor, Economics.