MAGA's Manly Manufacturing Misfire
Category: Stock Market & Investments
Via: bob-nelson • 11 months ago • 22 commentsBy: Paul Krugman
Understanding Trump’s other big failure
Trump doesn't understand his own supporters. And he doesn't care. He knows they'll support him, regardless.
So... overall, he has more to gain by fucking them over - which he must do to please the techbros - than by doing anything to actually help their real-world existence.
There are links in the seed.
According to Navigator Research, a significant number of Americans who voted for Donald Trump in 2024 now regret their choice. As the word cloud above suggests, this regret is largely driven by Trump's utter failure to deliver on his economic promises.
What did he promise? Most media attention has focused on his claim that he would bring the cost of living way down, starting on "day one." This claim never made any sense, especially because Trump's policy agenda — centered on tariffs and mass deportation — was clearly inflationary, not deflationary. And Trump isn't improving his standing with his reality denial "affordability" tour, which will clearly take the form of multiple speeches in which he demands that Americans reject the evidence of their own eyes and admit that prices are falling, not rising.
But while Trump's gaslighting on prices is a natural and appropriate target for critics, we shouldn't forget that the main goal of his policy agenda wasn't lower prices, it was job creation. Specifically, Trump and his economic advisers claimed — and may even have believed — that they would create lots of manly jobs for manly men. They would revive American manufacturing, they claimed, by unilaterally imposing huge tariffs and thereby breaking all our international agreements (and, whatever the Supreme Court may say, U.S. law). They would create mining and construction jobs, they claimed, by killing renewable energy and gutting environmental protection in order topromote fossil fuels. They would deport millions of undocumented workers which would result, they claimed, in a job boom for native-born workers.
My snark about "manly" jobs isn't gratuitous. Mike Konczal has an excellent review of the way the MAGA labor market story has failed, in which he emphasizes how regressively gendered Trump's vision was and is:
I wish I could tell you that the reason people in their twenties can't find jobs and the reason many of us are likely to be poorer over the next few years was more sophisticated than "we're going to turn all the girlbosses into tradwives once they see all the manly men at the USA iPhone-screwing factory." But I don't think it is.
Let me acknowledge, by the way, that U.S. men are having real problems. But nothing Trump is doing will help.
And even on its own absurd terms, the MAGA jobs strategy has been an abject failure — as abject as Trump's failureto bring down prices. Here are the current official employment numbers for manufacturing, construction and employment:
Contrary to Trumpist claims that the Biden expansion didn't create "real" jobs, the economy added a substantial number of jobs in "manly" sectors from 2021 to 2024. Part of this expansion was driven by Biden's green energy policies, which boosted both construction and manufacturing employment.
Trump has scrapped Biden's green energy policies in favor of tariffs and fossil fuels. But it isn't working. Instead, employment in "manly" sectors has fallen since Trump took office. And as Dean Baker points out, there are strong reasons to believe that even these job numbers are overstated, and will eventually be revised down further.
I'll talk about the failure of Trump's dirty energy strategy to create jobs on another occasion. For now, let's talk about why tariffs aren't reviving manufacturing.
Fundamentally, Trump and those who have his ear, especially Peter Navarro, his trade czar, made two big mistakes. First, they didn't do the math. Second, they failed to understand the nature of modern international trade.
When I say that they didn't do the math, I mean that as far as I can tell nobody with Trump's ear made any effort to estimate how many U.S. manufacturing jobs would be created even if the tariffs had eliminated U.S. trade deficits (which they were never going to do.)
Others, however, myself included, have done the math. (Arithmetic has a well-known liberal bias.) Back in June Robert Lawrence of the Peterson Institute for International Economics did a careful calculation that confirmed but improved on my own back-of-the-envelope estimates: Even a "successful" tariff policy would do little to revive U.S. manufacturing. Lawrence estimated that even if Trump somehow managed to eliminate the U.S. trade deficit in manufactured goods,
the share of workers in production occupations in US manufacturing would increase by just under 0.9 percentage point, from 3.85 to 4.7 percent … the changes in employment with balanced trade would be far too small to produce a labor market that significantly increases the opportunities for men without college degrees or the many places that have not shared in US economic growth over the past five decades.
Moreover, the tariffs have not made a significant dent in the trade deficit. In fact, the deficit was bigger in the first 9 months of 2025 than during the corresponding period in 2024. Why? Because international trade is very different in 2025 from what it was in the days of William McKinley, whose tariffs Trump admires.
In the modern world nations mostly don't sell each other completed consumer goods. Instead, the majority of trade involves sales of goods that are used to produce other goods. Last year the United States imported slightly less than $1.3 trillion worth of consumer goods plus autos, while importing more than $1.6 trillion worth of capital goods and industrial inputs. What this means in practice is that tariffs, which raise the prices of those capital goods and inputs, raise the production costs of U.S. manufacturers, in many cases making them less competitive with foreign producers.
So Trump's plan to create manly jobs has, predictably, been a bust — a bust as complete in its way as his failure to reduce prices. The only difference is that in the case of jobs he actually tried to do something. But what he did was counterproductive.
No doubt Trump will continue to give speeches boasting about nonexistent success, telling voters that we have the hottest economy in world history, etc. But his attempt to gaslight the nation about jobs will go no better than his gaslighting on the cost of living.
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These people have no idea what they're doing.
Two things:
The economy begins with the coming years tax returns.
Does anyone still listen to Paul Krugman?
Do you think that ordinary people who do not have substantial discretionary income are unaware of current high prices and high interest rates?
The ‘economy’ to them is very local. We have the same basic problem that we had with Biden: the economy technically is (still) good, the stock market is (still) good, but the short term factors that affect people’s lives (primarily prices) are not good.
Trump has not delivered on his main campaign promise and has instead acted to further raise prices. His great plan now is (of course) to engage in outrageous lying hoping that if he keeps claiming he has produced an A+++++ economy that enough gullible people will buy that total bullshit and continue to give him political cover.
1 - The economy is alway functioning. The date for tax returns is utterly irrelevant. Your statement is foolish nonsense.
2 - Yes. There are measures of influence. Krugman is among the most influential of all Americans.
Prices, yes. Interest rates, probably not.
Interest rates are actually not high by historical comparison. More recently, average mortgage rates have fallen by half a point over the last 12 months and by .8% since inauguration day. The Fed funds rate is 75 basis points lower than a year ago.
You and I both know that has nothing to do with Trump, but lots of people won't understand that.
A huge expense that I think many people forget about is the increase in healthcare costs and the corresponding increase in employer based health insurance premiums that impact the majority of American families.
Again, this has nothing to do with Trump, and there really isn't anything he could do about it if he wanted to, but it's going to have a substantive ripple effect across the economy throughout next year.
Yep. It's not as bad as I thought it was going to be. I'm not exactly sure how that's happening, but so far the tariffs have only added about 50bps to core inflation. emphasis on "so far". It just doesn't seem possible that a protracted tariff situation will not be increasingly inflationary as the months go by.
They matter to people wanting to secure a mortgage or other loan. Especially for those seeking refinancing as a way to help deal with their financial woes.
The expectation for rates was reset to low numbers. Thus people view current rates as high.
The only tie to Trump is his big mouth. He made promises and thus he now has to deal with the consequences.
Again, Trump made promises (big mouth) and thus is saddled with failing to get beyond a 'concept of a plan'.
Agreed. Basic economic mathematics shows this. Companies that absorb some of the costs cannot do so indefinitely. And, worse, the tariffs provide excuses for companies to raise prices (even when not forced to do so).
I am confident that by the end of next summer the US economy will be far better than it is now.
We all agree when inflation spiked, that prices would be hard to bring down. Today I just heard that the national average for a gallon of gas had dipped below $3. As of next month, Social Security will get a boost, and seniors won't be paying taxes on it. middle class families will be getting a tax cut. Foreign investment will be kicking in. The GDP third quarter growth hit 3.5%. We will know by next summer all we need to know.
The economic data from the 1980's proves you wrong.
Krugman is among the most influential of all Americans.
In getting things wrong?
Define specifically what you mean by 'US economy'.
Look at how average gasoline prices vary seasonally:
Prices always dip around this time of the year. This is to be expected.
Sounds good. But consider waiting for actual legislation to pass before making this claim .
I think a credible citation would be appropriate here. What Trump says is meaningless.
This sounds like another parroting of Trump. What, specifically, are you referring to and what was your source?
As I have noted, the GDP has generally been growing (even under Biden, Vic) and it fluctuates in the low positive single digits. There is nothing special about the current growth rate other than the GDP continues to be healthy in spite of Trump's stupidity.
I can only hope that the stock market remains stable, the GDP continues to grow, etc. Prices will almost certainly continue to rise.
One thing is clear, Trump will be an ongoing threat to a good economy.
I didn't say or imply they didn't matter, only that they were lower than historical averages and lower than they were when Trump took office.
Well... again... interest rates are, in fact, substantially lower. So I'm not sure this is the most effective argument against him.
Right. And combined with falling interest rates and the end of QE, this is an inflation cocktail waiting to be ignited.
Ironically, Trump's vanity and disregard for the facts may be what eventually saves the situation. It's not difficult to imagine a scenario where this finally starts to wear on the economy so Trump declares some imaginary victory based on no actual empirical data whatsoever and relents on the tariffs. That would be a very good time to have lots of money in the market.
He's not.
He is a fantastic source of confirmation bias for liberals and conservatives write him off due to his rampant bias. He influences almost nobody.
Here is the context:
Your language, if read literally in direct response to the language you quoted, would mean that you think ("yes") ordinary people "are unaware of " prices and ("probably not') NOT "are unaware of " (i.e. aware of) interest rates. I naturally assumed you made an easy mistake and that you meant that ordinary people are aware of prices (being high). Following suit, that you also meant ordinary people were NOT aware of interest rates (being high).
Thus, my response was that I think ordinary people are indeed aware of higher interest rates (defined as higher than what people have grown accustomed to) because plenty of people seek mortgages and other loans.
I understand from your recent post that what your brief language only meant is that you do not believe interest rates are high. Hopefully, you can see why I interpreted your words as I did.
It is in fact very easy to imagine this wearing on the economy. I am pleasantly surprised that the economy (and the stock market) seem to be resilient in spite of Trump. But since he keeps piling on, something has to give. What is also very easy to imagine is Trump declaring an imaginary victory based on no actual empirical data since he just did that very thing:
By next October Americans will be able to decide.
Don't worry, they can always go back to $Trillion budgets, inflation, open borders, endless subsidies for Obamacare and Medicaid fraud.
This is one of the problems in our nation. People like you believe things that are not true and then support Trump based on false 'facts'.
The deficit spending has been pretty much the same for 2025 as it has been for 2024 and 2023. Trump is not making any difference.
Inflation is still at normal levels. No change from Biden. .
And of course Trump has not lowered prices, he has in fact (with his brain-dead tariffs) created the dynamics for higher prices. You should know by now that tariffs are paid by US companies who then eventually pass them on to consumers (no choice).
You think borders are either open or closed (they are always at least partially open). Given the backlash seen in the election, it is likely that every PotUS would pay attention to the border now.
You think Trump has fixed fraud in Medicaid (actual fraud is a tiny percentage of what was cut) yet ignore the fact that his 'fraud' measures have also compromised millions of legitimate Medicaid recipients.
You ignore that Trump let parts of Obamacare expire and has not provided an alternative. He has been promising a real health plan since his first term. At what point in time do you recognize he is full of shit?
I do not think that they are unaware of either circumstance. You can already see that awareness in statistics. I was already thinking about credit-card usage as one signal, and after an enjoyable and deliberately de-euphemizing conversation with ChatGPT, it helped confirm that instinct by pointing to broader measures like the Financial Obligations Ratio, which tracks how much household income is already pre-committed to fixed expenses (Fed), alongside record-high and still-rising credit-card balances and widespread revolving usage (NYFRB; Fed).
Board of Governors of the Federal Reserve System. Financial Obligations Ratio (FOR) and Debt Service Ratio (DSR). Federal Reserve Bank of St. Louis (FRED). Accessed December 2025.
Federal Reserve Bank of New York. Quarterly Report on Household Debt and Credit. New York, NY: FRBNY; 2024–2025. Accessed December 2025.
Board of Governors of the Federal Reserve System. Consumer Credit – G.19 Statistical Release. Washington, DC: Federal Reserve; 2025. Accessed December 2025.
Federal Reserve Bank of St. Louis. Total Revolving Consumer Credit Outstanding. FRED Economic Data. Accessed December 2025.
People like me will defeat you all.
A responsible, rational, patriotic spirit.
It has been obvious that support for Trump is not about what is good for the nation, but rather an emotional drive to attack or defeat whatever the supporter views as the “evil left.”
Some of us care deeply about what is good for our nation and its people, and about what is good for society in general. We care about what is good, not some half-cocked, irrational, emotional drive to rail against those who are ideologically to the left of people who are demonstrably extremely right.
people like you will discover there's no room left in the lifeboats when the ss maga goes down ...
What will you do then? Will you put TiG in prison? Deport him to Nicaragua? To Guantanamo? Have him tried for treason, found guilty, and shot?
What are MAGA's intentions?
Not if truth, justice and the American way prevail!
The irony of this statement.