Art Laffer's Inside Track to Trump's Economic Recovery Team

By Susan Crabtree - RCP Staff

It took three phone calls the night of March 19 before President Trump reached Arthur Laffer, the renowned economist whose career has spanned five decades, nine presidents and at least four major economic crises, including the current coronavirus-induced freefall.

At that time last month, the world was still coming to grips with COVID-19’s grim toll. Some 500 people died in Italy that day, the deadliest toll thus far, and the Trump administration had unveiled a $1 trillion relief plan to try to stabilize the cratering economy.............. While he supports the $4 trillion in Federal Reserve loans to businesses crushed by COVID-forced worker lock-downs, he doesn’t believe the U.S. government should be bailing out big businesses with their own prior financial troubles, such as Boeing and American Airlines.

“Why should we bail out their investors and debtors – why should we lend money to losing companies? Let them re-structure and come back out swinging,” he told RCP. “It’s the same company — it’s only different owners. American Airlines – they go through bankruptcy every 10 years, and they’re still American Airlines. When people say you can’t let Boeing go under, I say, what the hell? The building’s gonna be there, all the people are gonna be there. It’s just going to be different owners.”

Laffer’s even less charitable when it comes to Mnuchin’s push to have the U.S. government hold an equity stake in airlines and other businesses: “That’s really what you want now? We can become Venezuela – whoooaaa!”  .............Council to Reopen America,.............Laffer was not among the names being circulated for the task force ..........“Whenever people make decisions when they are either panicked or drunk, the consequences are really rarely attractive,” he said. “And right now Washington is in a panic.”............“Arthur is not a fair-weather friend – he’s the opposite,” Forbes adds.............

As both parties look to bigger government solutions for the economy, Laffer says he hopes Trump continues to make his own executive decisions on re-opening the economy after carefully weighing the advice of health experts and economic advisers.

“Trump’s been, I think, a wonderful president, and just hope he doesn’t get misled,” he says. “And I’m going to do all I can to make sure he isn’t.”............To Read More....