If you don’t see it, it doesn’t exist

When a Trump appointee realizes the facts contradict his boss, he either misrepresents the facts or hides them.

The facts are the facts. They never change, but for a Trumper, it’s the perception, not any fact, that matters.

Thus, when Trump claims Ukraine invaded Russia, the lie doesn’t change the facts. But Trump and his MAGAs care only about public perception.

The economy is measured by a statistic known as Gross Domestic Product (GDP), calculated using the formula: Federal Spending + Non-federal Spending + Net Exports.

In the U.S., the National Bureau of Economic Research (NBER)—a nonprofit, nonpartisan organization dedicated to economic research—determines when we are in a recession by examining indicators of prolonged economic decline across various sectors.

It analyzes data points including real income, which reflects individuals’ purchasing power after adjusting for inflation; employment levels; industrial production output; wholesale and retail sales; and gross domestic product (GDP).

Mathematically, imposing high tariffs on imports, while deporting millions of workers and consumers, must raise prices and decrease GDP. Neither of these is a hypothesis or a prediction. It is a statistical certainty.

When GDP declines over several months, it is referred to as a “recession.” Conversely, when GDP decreases significantly and/or extensively, it is known as a “depression.”

Trump’s advisors must have realized that Trump’s plan to levy import duties and cut federal spending must result in inflation and recession or depression.

Rather than trying to correct Trump’s flawed policies, and actually prevent the depression, MAGAs prefer to change the measure.

Imagine selling a 2,000-square-foot house and wanting to tell the buyer it’s bigger than 2,000 square feet. Instead of physically enlarging the house, you simply change the measurement and decide that from now on, a foot will be eight inches long.

So your 2,000 foot house suddenly would be listed as 4,500 square feet. The house didn’t change, but by arbitrarily changing the measure, you could claim it was bigger.

Sounds ridiculous, even fraudulent, doesn’t it? But that is exactly what the Trump administration wants to do with GDP, in a futile effort to hide the inevitable recession and depression.

“A more accurate measure of GDP would exclude government spending,” Musk wrote on his social media platform. “Otherwise, you can scale GDP artificially high by spending money on things that don’t make people’s lives better.”

Is Musk asserting that federal spending on bridges, roads, dams, flight control, disaster recovery, anti-poverty efforts, medical research and development, Social Security, Medicare, Medicaid, and countless other initiatives the government undertakes to enhance our lives “doesn’t create value for the economy”?

That’s such nonsense.

Due to Musk’s budget cuts, GDP will decline. This presents a significant issue that Musk is well aware of. He is scared silly that when people see the decrease in GDP, they will accurately conclude that he is responsible for causing a recession.

The argument as articulated so far by Trump administration officials appears to play down the economic benefits created by Social Security payments, infrastructure spending, scientific research and other forms of government spending that can shape an economy’s trajectory.

“If the government buys a tank, that’s GDP,” Lutnick said Sunday. “But paying 1,000 people to think about buying a tank is not GDP. That is wasted — inefficiency, wasted money. And cutting that, while it shows in GDP, we’re going to get rid of that.”

Is Lutnick paid to come up with such a nonsense objection? His salary could be considered a waste of money. Thinking about war strategy is as important as building tanks.

The Commerce Department’s Bureau of Economic Analysis published its most recent GDP report on Thursday, showing that the economy grew at an annual rate of 2.3% in the final three months of last year.

The economy will drop like a stone under Trump, no matter how hard he tries to fake the numbers. While he remains in office, we will fall deeper and deeper into a depression.

The report makes it possible to measure the forces driving the economy, showing that the gains at the end of last year were largely driven by greater consumer spending and an upward revision to federal government spending related to defense.

Still, the federal government’s component of the GDP report for all of 2024 increased at 2.6%, slightly lower than overall economic growth last year of 2.8%.

Thus, even eliminating Federal Spending from the GDP equation won’t save Trump. His economy is doomed and everyone will know it. Fudging the figures won’t save him.

Lutnick’s false claim that federal spending doesn’t “make people’s lives better” is evident. Cutting federal spending will reduce personal income.

The government is not always a contributor to GDP and can subtract from it, which is what happened in 2022 as pandemic-related aid expired.

Lutnick said that the Trump administration would balance the federal budget with spending cuts, saying that would help growth and reduce the interest rates paid by consumers.

Historically, balancing the federal budget has led to depressions. 

“When we balance the budget of the United States of America, interest rates are going to come smashing down,” Lutnick said. “This is going to be the best economy anybody’s ever seen. And to bet against it is foolish.”

Under Biden, the economy grew massively. Under Depression Don Trump it will sink. My advice: Do what I have done. While Depression Don remains in office, convert a significant part of your asset portfolio to Treasuries.

That will help you ride out the coming storm.

Rodger Malcolm Mitchell

Monetary Sovereignty

Twitter: @rodgermitchell

Search #monetarysovereignty

Facebook: Rodger Malcolm Mitchell;

MUCK RACK: https://muckrack.com/rodger-malcolm-mitchell;

https://www.academia.edu/

……………………………………………………………………..

A Government’s Sole Purpose is to Improve and Protect The People’s Lives.

MONETARY SOVEREIGNTY