Saving American Lives or Propping Up Business: Trump Prefers the Later

An empty Times Square.

As various states are increasingly clamping down and closing business interests - Virginia tightened restriction as of midnight last night - in the hope of containing the COVID-19 virus and avoiding the nightmare playing out in New York City - actions condoned by medical experts - Donald Trump appears poised to loosen restrictions on public gatherings and business closures.  Why?  Because he fears a deep and/or prolonged recession will kill his chances of re-election.  Race baiting and xenophobic behavior may not be enough to rally his base if they are dying financially.  In Trump's mind, thousands of perhaps avoidable deaths of Americans is a small price to pay to help his re-election effort.  It's another example of why doesn't elect a malignant narcissist who has zero empathy for anyone to the White House.  A piece in the New York Times and one at CNN look at Trump's likely disregard for the warnings of medical experts.  For Trump supporters who think he gives a rat's ass about their very lives, they should perhaps open their eyes and think again.  First this from the Times piece:

As the United States entered Week 2 of trying to contain the spread of the coronavirus by shuttering large swaths of the economy, President Trump, Wall Street executives and many conservative economists began questioning whether the government had gone too far and should instead lift restrictions that are already inflicting deep pain on workers and businesses.

Consensus continues to grow among government leaders and health officials that the best way to defeat the virus is to order nonessential businesses to close and residents to confine themselves at home. Britain, after initially resisting such measures, essentially locked down its economy on Monday, as did the governors of Virginia, Michigan and Oregon.

Relaxing those restrictions could significantly increase the death toll from the virus, public health officials warn. Many economists say there is no positive trade-off — resuming normal activity prematurely would only strain hospitals and result in even more deaths, while exacerbating a recession that has most likely already arrived.

The economic shutdown is causing damage that is only beginning to appear in official data. Morgan Stanley researchers said on Monday that they now expected the economy to shrink by an annualized rate of 30 percent in the second quarter of this year, and the unemployment rate to jump to nearly 13 percent. Both would be records, in modern economic statistics.

Mr. Trump and a chorus of conservative voices have begun to suggest that the shock to the economy could hurt the country more than deaths from the virus.

On Monday, Mr. Trump said his administration would reassess whether to keep the economy shuttered after the initial 15-day period ends next Monday, saying it could extend another week and that certain parts of the country could reopen sooner than others, depending on the extent of infections.

Any push to loosen the new limits on commerce and movement would contradict the consensus advice of public health officials, risking a surge in infections and deaths from the virus. Many economists warn that abruptly reopening the economy could backfire, overwhelming an already stressed health care system, sowing uncertainty among consumers, and ultimately dealing deeper, longer-lasting damage to growth.

The recent rise of cases in Hong Kong, after there had been an easing of the spread of the virus, is something of an object lesson about how ending strict measures too soon can have dangerous consequences. Yet places like China, which took the idea of lockdown to the extreme, have managed to flatten the curve.

The piece at CNN looks at this issue as well and what may be Trump's motivations which have lettle to do with reducing the death toll.  Here are excerpts:

President Donald Trump appears to have made his choice in the awful dilemma posed by the coronavirus pandemic -- whether to destroy the nation's economic foundation in order to save lives.

In his zeal to fire up American prosperity after helping to trigger an unprecedented self-inflicted economic meltdown, Trump is already losing patience -- weeks before the virus may peak. His comments came on day when the number of confirmed cases soared past 40,000 and 100 people died in a single day for the first time. Dr. Deborah Birx, a member of Trump's coronavirus task force, warned that the "attack rate" of the disease in New York, America's dominant economic and financial powerhouse, was five times that of elsewhere. Trump's change of emphasis previewed a building confrontation inside his own administration -- between public health officials using the science of epidemiology to battle Covid-19 and political and economic officials desperate to save an economy that is fundamental to basic life and Trump's reelection hopes.

[Trump's] The President's upbeat prediction of a return to full speed ahead directly contradicted the actions of state governors nationwide -- who are imposing stay-at-home orders, closing businesses and ordering schools out for summer in March.

Local and public health authorities fear the highly contagious virus will cause a tsunami of critically ill patients that will swamp hospitals and mean people will die in the thousands.

The idea that the situation will stabilize in a few weeks -- when most experts say that much, much worse is to come -- appears fanciful. This raises the question of whether Trump is willing to take a decision that could indirectly cause many deaths but that could save millions of other Americans from the deprivations brought on by economic blight. Trump's course change -- after warning last week the shutdown could last until July or August -- was consistent with the scattershot way in which he has managed the coronavirus pandemic.

He spent weeks denying it was a serious problem, predicting it could simply go away and was not much worse than the flu. It was noticeable Monday that Trump was talking about the virus in the past tense. . . . And he went back to comparing Covid-19 to the seasonal flu even though it is far more virulent, has a far higher death rate and has no vaccine. Then he borrowed an argument being made by conservative commentators.

"You look at automobile accidents, which are far greater than any numbers we're talking about. That doesn't mean we're going to tell everybody no more driving of cars. So we have to do things to get our country open," Trump said. Trump's apparent impatience, only days after declaring war on the virus, raises questions about the depth of his thinking and his own motivations given the importance of a strong economy to his reelection campaign. And his sudden lurches make it more difficult to unite the nation behind him in the grim fight.

This would not be the first time that Trump has been influenced by conservative news chatter or that his personal political goals might weigh heavily on his thinking.

A strong economy will mean nothing if one or one's loved ones are dead.  Once again, Trump puts his personal interests ahead of the lives of citizens.  Sadly, no one should be surprised. 

The Coronavitus Will Cause a Political Pandemic

As a column in the Washington Post notes, so far Donald Trump's handling of the coronavirus has been less than a study in building public confidence.   Indeed, Trump and his sycophants continue to suggest that the entire health care scare is a hoax and his regime is trying to censor statements by medical experts.  Trump's main concern is not public health and citizens dying but instead the stock market level.  Having a malignant narcissist in the White House during a potential pandemic is decidedly not a good thing. Here are column excerpts:

Political interference with that process will almost certainly backfire by corroding public confidence and abetting confusion. Some of Trump’s public comments have not been helpful because they suggest that the president is not entirely in agreement with some of his medical advisers.

No doubt [Trump] the president is unhappy with the dramatic decline in the stock market. He has clearly indicated that he expected to make the market’s spectacular gains a major theme in his bid for reelection.

This will be harder now, maybe impossible. But if Trump responds by searching for scapegoats or blaming his economic and health advisers, he will make a bad situation worse — for him, the country and (possibly) the world.

A piece in Vanity Fair looks at the potential political consequences of a spread of the virus in America may mean in the context of the presidential election.  Here are highlights: 

If trends hold, the coronavirus will soon upend daily life here in the United States. Schools in some cities will close for a while; supply chains will be disrupted; people will stay at home; and the economy will suffer a blow. Even now, stock prices have continued to fall, and surgical masks have been sold out for weeks. Yesterday, we could read about the first case of so-called community transmission, after a patient in northern California tested positive for coronavirus despite having no obvious link to anyone else with it. Despite assurances from Donald Trump this week that “we’ve had tremendous success” in containing the coronavirus outbreak, Americans are unconvinced.

Coronavirus is going to be everybody’s running mate in 2020, and the question is who will fare worst as a result. In what’s normally a zero-sum game, whatever hurts one candidate helps the other. But coronavirus won’t be so clear-cut. A lot depends on how bad things get and who is running against whom.

On the Republican side, we know we’re getting Trump, and early signs of his approach to the virus are unpromising. An engaged president would be on the phone daily with CDC officials, members of Congress, military leaders, cabinet officials, medical experts, and even companies like 3M, which produces the masks on which people will be relying. Trump instead sounded like someone who got a few scattered briefings. Asked about why the CDC—which, as feared, has been stumbling out of the gate—has tested only about 500 people, versus the thousands of tests being conducted in other countries, Trump couldn’t hide that he was winging it, . . . before going into a recitative about washing hands. Trump hasn’t been sounding much of an alarm, for fear of setting off panic and seeing stock prices fall further, so life has continued as normal. He has no evident master plan, and yesterday he was trafficking in the-flu-is-worse clichés that were last in fashion weeks ago. He’d be better off as the border fanatic that people believe him to be.

If we get through the next couple of months without a big outbreak, then Trump will be in okay shape. While he might not get a lot of credit for preventing disaster (because people rarely do), he won’t suffer for it, and he’ll be able to boast of aggressive measures taken, regardless of what we did. If things get very bad, however, then Trump will have a tough time hanging onto office. We can see he knows this is a possibility, because he has appointed Mike Pence to oversee the federal response. This is a lot like China’s leader Xi Jinping assigning a similar task to Premier Li Keqiang. If things get bad, you can blame it on the bumbling lieutenant.

Meanwhile, among Democrats, coronavirus has a quite different effect. Trump’s loss is their gain, in the big picture, but they are also running against one another. In the most mundane realm, self-quarantining means that people don’t leave their homes. They don’t vote, don’t caucus, and don’t show up for rallies. This limits the ability of candidates to mobilize people, and it favors those who get a lot of attention even without campaigning on the ground. It’s okay for Mike Bloomberg, who has ads running all day on television, but it’s less ideal for the others. Bernie Sanders fires up his supporters with enormous rallies, as Donald Trump and Barack Obama did before him. Those would have to cease for a while.

Coronavirus will have people looking for plausible managers. Bloomberg, of course, has been mentioned in that regard, and it will help him. Elizabeth Warren, who claims to have plans for most things, might also get a lift. Blandness will become a virtue, as well, so Amy Klobuchar will look stronger. On the other hand, Joe Biden would not be likely to gain much ground. He has no real reputation for management, and he also lacks the vigor characteristic of effective leaders in crisis.

Bernie Sanders is less of a manager, but he would have a different and important advantage in the middle of an epidemic, which is commitment to “Medicare for all.” It sounds too drastic for many Americans when things are normal. It doesn’t sound so drastic during a pandemic, when infected people will be avoiding doctor’s appointments for fear of bankruptcy. As things stand, it’s all too plausible that, within a few weeks, people will be safer in Shanghai than in New York, because in China people are vigilant, and cases are finally on the wane, while here things are looser, and just getting started. The coronavirus will shuffle the political deck for everyone, the more so the longer it continues. But no matter who profits or loses politically with this epidemic, sane people can only hope that it comes and goes fast. The less effect it has on our politics, or anything else, the happier we’ll be. Even Mike Bloomberg would agree.

The Trump Regime's Disturbing Response to the Coronavirus

So far America seems to have dodge a bullet when it comes to the coronavirus.  That said, there is absolutely no assurance that this will continue and, if it does not, the Trump/Pence regime's response is frightening, especially since science denying Mike Pence has been put in charge of the regime's response and has censorship power over legitimate experts.  Just as disturbing, the regime has indicated that whether one can receive needed treatment if the virus spreads will depend upon one's ability to pay since big Pharma cannot be denied the ability to make huge profits.  A piece in the New York Times looks at the disturbing prospects facing America.  Here are highlights:

So, here’s the response of the Trump team and its allies to the coronavirus, at least so far: It’s actually good for America. Also, it’s a hoax perpetrated by the news media and the Democrats. Besides, it’s no big deal, and people should buy stocks. Anyway, we’ll get it all under control under the leadership of a man who doesn’t believe in science.

From the day Donald Trump was elected, some of us worried how his administration would deal with a crisis not of its own making. Remarkably, we’ve gone three years without finding out: Until now, every serious problem facing the Trump administration, from trade wars to confrontation with Iran, has been self-created. But the coronavirus is looking as if it might be the test we’ve been fearing.

The story of the Trump pandemic response actually began several years ago. Almost as soon as he took office, Trump began cutting funding for the Centers for Disease Control and Prevention, leading in turn to an 80 percent cut in the resources the agency devotes to global disease outbreaks. Trump also shut down the entire global-health-security unit of the National Security Council.

Experts warned that these moves were exposing America to severe risks. “We’ll leave the field open to microbes,” declared Tom Frieden, a much-admired former head of the C.D.C., more than two years ago. But the Trump administration has a preconceived notion about where national security threats come from — basically, scary brown people — and is hostile to science in general. So we entered the current crisis in an already weakened condition.

The first reaction of the Trumpers was to see the coronavirus as a Chinese problem — and to see whatever is bad for China as being good for us. Wilbur Ross, the commerce secretary, cheered it on as a development that would “accelerate the return of jobs to North America.”

The story changed once it became clear that the virus was spreading well beyond China. At that point it became a hoax perpetrated by the news media. Rush Limbaugh weighed in: “It looks like the coronavirus is being weaponized as yet another element to bring down Donald Trump.

And in case you’re wondering, no, the coronavirus isn’t like the common cold. In fact, early indications are that the virus may be as lethal as the 1918 Spanish Flu, which killed as many as 50 million people.
 Financial markets evidently don’t agree that the virus is a hoax; by Thursday afternoon the Dow was off more than 3,000 points since last week. Falling markets appear to worry the administration more than the prospect of, you know, people dying.
 At that point the administration appears to have finally realized that it might need to do something beyond insisting that things were great. But according to The Washington Post’s Greg Sargent and Paul Waldman, it initially proposed paying for a virus response by cutting aid to the poor — specifically, low-income heating subsidies. Cruelty in all things.

On Wednesday Trump held a news conference on the virus, much of it devoted to incoherent jabs at Democrats and the media. He did, however, announce the leader of the government response to the threat. Instead of putting a health care professional in charge, however, he handed the job to Vice President Mike Pence, who has an interesting relationship with both health policy and science.

Early in his political career, Pence staked out a distinctive position on public health, declaring that smoking doesn’t kill people. He has also repeatedly insisted that evolution is just a theory. As governor of Indiana, he blocked a needle exchange program that could have prevented a significant H.I.V. outbreak, calling for prayer instead.

And now, according to The Times, government scientists will need to get Pence’s approval before making public statements about the coronavirus.

If the facts don’t make Trump look good, he and his allies attack the messengers, blaming the news media and the Democrats — while trying to prevent scientists from keeping us informed. And in choosing people to deal with a real crisis, Trump prizes loyalty rather than competence.

Maybe Trump — and America — will be lucky, and this won’t be as bad as it might be. But anyone feeling confident right now isn’t paying attention.

Our Worse Fears Are Being Realized

The gift America most needs.

Anyone who followed Donald Trump's real estate career and public life in general - ask New Yorkers who knew he best - and it should have been a foregone conclusion that the man was unfit for the White House or any public office.  Yet by playing the race card and playing to white fears of loss of privilege, Trump convinced 70,000 voters spread across three states to throw away decency, morality and even common sense and vote for him.  Now, we are seeing the spectacle so many of us feared borne out in the form of a dangerous narcissist in the White House who is creating chaos on literally every front.  Wall Street, with its ominous December stock market plunge has belatedly signaled its fear of a madman in the White House. International relations with long time allies are in chaos as well with Trump giving a nod to dictators and enemies of the United States to do as they wish.  NONE of this should be a surprise to anyone not blinded by racism and hatred towards those who are different.  A column in the Washington Post looks at this realization of responsible Americans' worse fears.  Here are highlights:

When the new year begins next week, President Trump will have an acting chief of staff, an acting secretary of defense, an acting attorney general, an acting EPA administrator, no interior secretary, and no ambassador to the United Nations. The officials originally in all those positions have either been fired or have quit in various measures of disgust or scandal. His former campaign chairman, deputy campaign chairman, national security adviser and personal lawyer have all pleaded guilty to crimes. His campaign, his transition, his foundation and his business are all under investigation. The United States’ allies are horrified at the chaos Trump has brought to our foreign policy. The stock market is experiencing wild swings as investors are gripped with fear over what might be coming and what Trump might do to make it worse — a situation alarming enough that the treasury secretary felt the need to call up the CEOs of major banks to assure them that everything is under control.

And, oh yeah, the government is shut down.  This, my friends, is exactly what we were afraid of when Trump somehow managed to get elected president two years ago. This is what we warned you about.

. . . . here’s what happened over the weekend with regard to the departure of Defense Secretary Jim Mattis, widely regarded as the sanest of Trump’s national security team and one of the few original members of Trump’s Cabinet who did not show himself to be incompetent, corrupt, or both. . . . . Mattis, who has watched in dismay as Trump has set about to degrade the alliances that have shaped U.S. foreign policy for the last seven decades.

So Mattis tendered his resignation. . . . Trump decided hastily to remove Mattis in reaction to negative news coverage, according to senior administration officials, one of whom said the president was eager to retaliate against Mattis and show up the widely respected former general.

Nothing says “well-oiled machine” like that distinctly Trumpian combination of paranoia and vindictiveness.

Meanwhile, the government shutdown is expected to last into the new year, a shutdown that is happening because a bunch of Fox News and talk-radio hosts criticized the president for not being tough enough in fighting for his ludicrous border wall. Trump, always deeply insecure and eager to feed his base’s endless rage and desire for conflict, responded quickly to the accusation of weakness. “He spends ever more time in front of a television, often retreating to his residence out of concern that he is being watched too closely,” reports the New York Times.

Two years ago, as we were still trying to wrap our heads around the idea that Trump was actually going to be president of the United States, it was not uncommon to hear the hopeful prediction that things wouldn’t work out as badly as we feared. The weighty responsibilities of the office would turn Trump serious, sober, “presidential.”

That has not occurred. If anything, Trump has shown himself to be even more of a despicable human being than he appeared then, and utterly incapable of growing into the office. He is just as petty, just as impulsive, just as narcissistic, just as dishonest and, perhaps, even more corrupt than we realized.

[I]f you’re a Republican, he has done many things that pleased you, such as cutting taxes for corporations and the wealthy, or slashing regulations that protect workers, consumers, and people who enjoy breathing air and drinking water. If you thrill to the sight of immigrant children being ripped from the arms of their parents, then this presidency has been a joy.

[I]n so many ways, he has shown himself again and again to be not just as bad as we thought, but worse. As as we look forward to the next two years, we must realize that there will be no stability, no settling down, no period of calm. The best we can hope for are brief moments when the lunacy pouring from the White House is more comical than terrifying. But most of the time, they’ll probably be both.

A second column adds this summary:

The chaos all around us is what happens when the nation elects an incompetent, narcissistic, impulsive and amoral man as president. This Christmas, heaven help us all.

It is difficult, at the moment, to fully assess the damage Trump is wreaking. We have never had a president like him, so history is a poor guide. For his racism, we can perhaps look back to Woodrow Wilson; his general unfitness to hold the nation’s highest office recalls the hapless Andrew Johnson. Maybe Andrew Jackson was as impetuous, maybe Richard M. Nixon as venal.

As multiple investigations close in, including the one led by special counsel Robert S. Mueller III, Trump will surely lash out. I believe things will get worse before they get better.

GOP Leaders Won’t Tolerate Trump’s Chaos Much Longer

The Republican Party of my grand parents, parents and even the first 2/3's of my life is dead and gone and, in my view, will never return given the grip Christofascists and white supremacists have on the party base.  The days when intellect, knowledge, science and some modicum of respect for morality and decency are long gone best embodied by the election of Donald Trump, a Manchurian candidate if there ever was one. Yet, as a piece in New York Magazine argues, at some point the Vichy Republicans who have colluded with Trump's assault on America - likely at the direction of Vladimir Putin - will reach a breaking point when their desire for self-preservation outweighs their fear of being subjected to a primary challenge by someone base and immoral enough to be fancied by the Christofascists and white supremacists who rule the party.  Here are column highlights:

The beginning of the end of the Trump presidency came and went a long time ago. I have never wavered from my oft-stated convictions that (a) Trump will not finish out his term, and (b), the end will be triggered by a presidential meltdown that forces the Vichy Republicans in Washington to mount an insurrection — if only to save their own asses, not the country. This week was a big step toward that endgame, and surely one of the most remarkable weeks in American history. We have a president of the United States who is moving to shut down the government at the same moment that he is inviting America’s adversaries to breach its defenses. The withdrawals in Syria and Afghanistan, combined with the exit of the last top administration official who aspired to serve the national interest rather than Trump’s, invites hostile moves against the United States from ISIS, Russia, China, North Korea, and the Taliban. This has even grabbed the cynical Mitch McConnell’s attention: He has declared himself “distressed” by Mattis’s resignation, a major step in rhetorical escalation in a party where Susan Collins’s pathetic periodic expressions of “concern” are what pass for criticism of an outlaw president. [M]ore outrage from more GOP leaders will follow. What will move them is not necessarily Trump’s hara-kiri isolationist agenda but the damage his behavior both abroad and at home is inflicting on the financial markets. The sheer uncertainty of a chaos presidency is pushing the Dow to its worst December since the Great Depression. McConnell and his humiliated departing peer Paul Ryan have tolerated Trump’s racism, misogyny, and nativism, his wreckage of American alliances, his kleptocracy, and his allegiance to Vladimir Putin. They have tolerated as well his con job on the coal miners, steelworkers, and automobile-industry workers of his base. But they’ll be damned if they will stand for a president who threatens the bottom line of the GOP donor class. The Mattis resignation is huge. It’s not that he was the last “adult in the room” but that as a retired military man and a secretary of Defense with access to both foreign intelligence and the inner workings of the White House, he knows treason when he sees it. His resignation letter stops just short of saying that Trump is actively serving the “interests” of China and Russia as they try “to shape a world consistent with their authoritarian model.”

[W]ho knows where America will be or who will be in charge by the time we get to Mattis’s announced February departure date, more than two months from now. The country is going to be riveted by the televised testimony of lawyered-up Trump lackeys as they face the inquisitors of Nancy Pelosi’s Congress.

What we are likely to see in the meantime: further indictments of Trump family members and other close associates; a complete halt to governance in Washington whether there’s actually a government shutdown or not; new overt and covert threats to national security; a further effort by Trump to destabilize the Federal Reserve and assault its chairman; and perhaps, at last, an intervention by those Vichy Republicans, in the financial sector as well as in the capital, who see their own necks on the line.

But meanwhile, we have more than two weeks in store of watching an isolated madman rampaging through the gilded rooms of Mar-a-Lago, wreaking whatever damage he can on the country as the walls of justice continue to close in on him. Happy New Year!

Trump, Trade Wars and the Stock Market

In gathering materials together for my accountant yesterday, I noticed that the recent declines in the stock market had literally cost me thousands of dollars.  No small part of the stock market decline has been triggered by the idiocy of the occupant of the White House who thinks he knows everything when in fact, he knows little about seemingly anything.  Wild talk and trade wars may thrill Der Trumpenführer's base in the short term, but the stock market does not like wild talk, unhinged reality TV behavior and/or unneeded trade wars.  As a column in the New York Times notes, the stock market and investors like stability, predictability and no barriers to trade/investment.  What Trump is pushing is the exact opposite and the stock market is revealing what it thinks of the batshitery.  Here are column excerpts:

As I write this, China’s announcement of a new round of tit-for-tat tariffs has stoked fears of trade war and sent stock futures plunging. If this morning’s futures hold, the S&P 500 will be about 10.5 percent off its January peak, around 6 percent off its level when Gary Cohn, the last of the Trump “globalists,” was pushed out.

My question is, why such a large fall?

One good answer is, that’s a stupid question. The three rules you need to bear in mind when discussing the stock market are (1) the stock market is not the economy (2) the stock market is not the economy (3) the stock market is not the economy. And stocks move for all sorts of reasons, or no visible reason at all. As Paul Samuelson famously quipped, the market has forecast nine of the last five recessions.

Another answer is that the trade war is a signal: Trump, Navarro et al are showing that they really are as unhinged and irresponsible as they seem, and markets are taking notice. Imagine how these people would handle a financial crisis.

[T]here is a reason why stock prices might overshoot the overall economic costs of a trade war. For a trade war that “deglobalized” the U.S. economy would require a big reallocation of resources, including capital. Yet you go to trade war with the capital you have, not the capital you’re eventually going to want – and stocks are claims on the capital we have now, not the capital we’ll need if America goes all in on Trumponomics.
Or to put it another way, a trade war would produce a lot of stranded assets.

The costs of protectionism, according to conventional economic theory, are not that tariffs caused the Great Depression, or anything like that. They come, instead, from moving your economy away from things you’re relatively good at to things you aren’t. American workers could sew clothes together, instead of importing apparel from Bangladesh; in fact, we’d surely produce more pajamas per person-hour than the Bangladeshis do. But our productivity advantage is much bigger in other things, so there’s an efficiency gain – for both economies – in having us concentrate on the things we do best.

And a trade war, by imposing artificial costs such as tariffs on international trade, undoes that productive specialization, making everyone less efficient.

Under free trade, we import anything that costs less to produce abroad than at home. If we impose a tariff, we end up not importing stuff unless the price of the import is sufficiently low that it’s cheaper even including the tariff. The marginal good we import, then, is actually much cheaper than a domestic product, and the marginal good we don’t import costs the economy a lot – specifically, the tariff that we would have paid if we did import it. . . . at each step we are imposing costs on the economy equal to the extra cost of the domestic product that replaces an import. Since about 1990 corporate America has bet heavily on hyperglobalization – on the continuance of an open-market regime that has encouraged complex value chains that sprawl across borders. The notebook on which I’m writing this was designed in California, but probably assembled in China, with many of the components coming from South Korea and Japan. Apple could produce it entirely in North America, and probably would in the face of 30 percent tariffs. But the factories it would take to do that don’t (yet) exist. Meanwhile, the factories that do exist were built to serve globalized production – and many of them would be marginalized, maybe even made worthless, by tariffs that broke up those global value chains. That is, they would become stranded assets. Call it the anti-China shock.

Of course, it wouldn’t just be factories left stranded by a trade war. A lot of people would be stranded too. The point of the famous “China shock” paper by Autor et al wasn’t that rapid trade growth made America as a whole poorer, it was that rapid changes in the location of production displaced a significant number of workers, creating personal hardship and hurting their communities.

[M]y original question was why stocks are dropping so much more than the likely costs of trade war to the economy. And one answer, I’d suggest, is disruption – which business leaders love to celebrate in their rhetoric, but hate when it happens to them.