Sunday, November 26, 2017

Sunday Week in Review

What else did Donald Trump do this week?

Thankfulness. On the Tuesday before Thanksgiving, press secretary Sarah Huckabee Sanders instituted a rule: before reporters could ask her a question, they had to say what they were thankful for. For the most part, the press corps played along, although ABC correspondent Cecilia Vega's pointed response, "the First Amendment," got a few appreciative hoots.

On Thanksgiving Day, Bloomberg reporter Margaret Talev attempted to ask Trump what he was thankful for. According to the press pool report, Talev "was then reprimanded by a member of the communications staff."

Self-promotion. Trump spent part of Thanksgiving Day with members of the Coast Guard, and he used that occasion, as well as a satellite broadcast to other military units worldwide, to salute what he saw as the source of the military's accomplishments: himself. Much of his speeches focused on how much better a job he regards himself doing than President Obama. Among his comments:

"We know how to win, but we have to let you win. You weren't winning before. They were letting you play even. We want to let you win.

"It's nice that you're working for something that's really starting to work."

"We're very very proud of you. Everybody in this country is watching and they are seeing positive reports for a change. Instead of the neutral and negative reports."

"They say we've made more progress against ISIS than they did in years of the previous administration, and that's because I'm letting you do your job."
As usual, Trump did not specify who "they" were. The main difference between Obama's and Trump's administration of the armed forces has been that Trump has essentially opted out of the actual job of the president, which is to act as the commander-in-chief. Instead, he has turned day-to-day control over operations to the Department of Defense, which allows him to shift blame to military commanders when things go wrong.

401(k)s. Trump packed a whole lot of confusion and deception into one sentence in particular of his Coast Guard address when he told his audience of servicemembers: "Your whole, long life, the stock market is higher than it's ever been. And that means your 401(k), all of the things that you have, whether it's -- even if you're in the military, you have a country that's really starting to turn."

One report says that Trump was pointing at a small child--perhaps one about nine years old, in which case his point about the stock market having been "higher than it's ever been" for the child's entire life is accurate but not the compliment to himself he probably meant. Since bottoming out in 2008, the major American indices have all been steadily higher. More broadly speaking, the same thing is true for the stock market since before the Great Depression.

Trump's apparent belief that Coasties are motivated by their "401(k)s" is also telling. Members of the military don't have them, but they do have access to a similar tax-advantaged defined-contribution program known as a Thrift Savings Plan (TSP). Unlike most other federal or private-sector employees, most members of the military do not get their contributions matched, and contributions are capped at 5% of salary.

A typical chief petty officer (E-7) in the Coast Guard who made the maximum contribution last year to his or her TSP, and invested it in a low-cost S&P 500 index fund, would be putting about $2,000 into the stock market and would have realized about $182 in gains since Trump's inauguration. This is slightly more than the $158 that would have been earned to date in a typical year--the average S&P 500 return is about 9.6%--and much less than the $605 that would have been returned between the day Barack Obama took office and Nov. 26, 2009.

As a rule, military servicemembers do not cite the fact that the TSP allows them to defer taxes on 5% their income as a reason for undertaking military service.

Net worth.  Trump's personal wealth has always been difficult to estimate, if only because he has openly admitted in the past to making up numbers based on his "feelings." (In his words, “My net worth fluctuates, and it goes up and down with markets and with attitudes and with feelings, even my own feelings.") But according to an analysis published this week in Crain's New York Business, the sales figures reported by the Trump Organization (the main source of Trump's income) in the past were "flagrantly untrue" and over-reported its income by a factor of ten or more.

The difference is that this year, some details of Trump Organization finances are public because Trump holds public office, making its valuation less a matter of "feelings" and more a matter of actual money.

Ironically, while an S&P index fund won't make a big difference to the financial security of the typical Coast Guard member, Trump himself would apparently be much wealthier today if he had simply poured his enormous inheritance into one and played golf, rather than trying and frequently failing to make money himself. $40 million, which is a plausible estimate for how much money Trump had received from his father by 1974, would have yielded roughly $4 billion today.

Why are these bad things?

  • A president should not be so afraid of the press that he sends his staff out to chastise them for asking questions about thankfulness on Thanksgiving.
  • Even if a president thinks he, and not the military he commands, is responsible for military successes, saying so right in front of them is a pretty dickish thing to do.
  • A president who thinks 401(k)s are what military personnel care about--or can even get through their military jobs--is dangerously out of touch.
  • Past a certain point, lying in order to make yourself seem more accomplished becomes pathological.