Trump’s Economic Agenda Is Unfocused. Here’s How to Fix It.

COMMENTARY Taxes

Trump’s Economic Agenda Is Unfocused. Here’s How to Fix It.

Jul 5th, 2018 3 min read
COMMENTARY BY
Paul Winfree

Director, Roe Institute for Economic Policy Studies

Paul Winfree serves as director of the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation.

Key Takeaways

Unfortunately, this administration has not been able to establish that coherent, focused agenda.

The president has an opportunity to demonstrate leadership, by helping to create an environment that not only encourages and enables American entrepreneurs.

Without a focused agenda to connect the United States’ potential workforce with its entrepreneurs, the economic successes will fall short of their full potential.

Thus far in his administration, President Trump’s economic agenda has focused on tax reform and deregulation. Those efforts have doubtless helped keep the fire of job creation burning brightly.

But filling these newly created jobs is a different matter altogether, and some workers have been left behind. For tax and regulatory reform to produce equitable economic growth, we need a robust domestic policy agenda where worker supply and demand go hand in hand.

Unfortunately, this administration has not been able to establish that coherent, focused agenda. There are several ways this can be addressed.

First of all, the president’s personnel should be aligned to current needs. A good place to start: Adjust White House staff portfolio assignments to better leverage the agencies’ resources. For example, the Domestic Policy Council is relatively small, and a disproportionate number of its staff are assigned to health policy.

Health policy is important; however, the Domestic Policy Council needs to address a broader range of goals, while the Department of Health and Human Services is better placed to continue the important work of reducing the cost of health care and improving choices in the delivery of care.

Second, domestic policy agenda-setting is spread thin through the White House. The Office of Economic Initiatives, headed by Ivanka Trump, has been working on workforce development reforms, as well as a proposal to provide paid family leave to new parents. The president’s son-in-law, Jared Kushner, has been thinking through prison reforms through his Office of American Innovation. The president’s senior policy adviser, Stephen Miller, has been point on immigration policy. For the most part, division of labor drives the process, with no unified strategy for tying it all together.

Third, it is difficult to ascertain any semblance of a coherent domestic policy by analyzing Trump’s budgets. The blame should not fall on the Office of Management and Budget. The budget preparers do what they do best: align programmatic reforms with overarching fiscal goals. But given the absence of domestic policy goal-setting, the OMB’s fiscal documents can’t help but send Congress mixed messages. This result: formal policy positions that are wholly inconsistent with the budget.

Perhaps ambiguity is Trump’s objective. That way the administration can wait until Congress delivers on a domestic policy accomplishment and then take some of the credit. However, having served as deputy director of this president’s Domestic Policy Council, I can honestly say that I would be surprised if that were the strategy. Rather, the main problem is that the president has too many head chefs in the policy kitchen, not enough staff, and no concrete vision of where he wants to go or how to get there.

“Make America Great Again” may be a fine campaign slogan, but it needs to be supported by a robust agenda. The president has an opportunity to demonstrate leadership, by helping to create an environment that not only encourages and enables American entrepreneurs to create jobs but also encourages people to realize their own potential by entering the workforce.

To do this, the president should retool his domestic policy team and give it a new focus that supports the success of the economic agenda. This team should put all of its energies into developing ways to lift up people who have been left behind, helping them participate in the growing economy and receive the benefits of that participation.

This does not require a new set of federal programs or the expansion of current failed programs (as many federal job training programs tend to be). But it will require reforms to the existing system to remove barriers to work, as well as access to job and capital markets. For instance, overhauling occupational licensing restrictions is long overdue. Additionally, the agencies and Congress need to reform welfare programs so they help — not hurt — the people they serve by encouraging work and institutions that promote economic mobility.

At the Heritage Foundation, we have convened a series of workforce development panels, talking with large and small entrepreneurs from all regions of the country. These discussions indicate that employers would quickly raise wages to at least $15 an hour for even low-skilled jobs if only they could find people who could fulfill basic requirements, such as drug tests, and stay on the job for a significant period of time. In fact, to overcome the first obstacle, many employers report that they have already dropped marijuana drug tests as a requirement for employment.

Helping those left behind may not be easy. But the president needs an invigorated domestic policy agenda to get the job done. Without a focused agenda to connect the United States’ potential workforce with its entrepreneurs, the economic successes will fall short of their full potential.

 

 

This piece originally appeared in the Washington Post