Donald Trump announces his new American industrialism, and that’s the subject of “The Riff.” On the very same day of the Wall Street Journal editorial that the Biden manufacturing boom never happened, and in fact U.S. industry output has been flat for two years, Mr. Trump gave an important speech in Savannah, Georgia on his plan for a new American industrialism.
First up, the Journal points out that the ISM purchasing managers for manufacturing has been in almost continuous contraction since the autumn of 2022. Virtually all the manufacturing jobs under Biden-Harris were bounce-backs from the pandemic.
Jobs and hours worked have declined since October 2022, while real average weekly wages for manufacturing workers are 2.7% lower than in January 2021. All this despite trillions of dollars of Biden-Harris subsidies and tax credits for the Green New Deal.
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However, overregulation, especially climate-related overregulation, along with ratcheting inflation, suppressed most hard goods industries. The Biden EPA climate rules threw a wet blanket over paper, cement, glass, steel, iron and chemicals. Add to that burden the problem of soaring electricity prices!
So, along comes Mr. Trump today. Take a listen:
DONALD TRUMP: “So, as your president, here is the deal that I will be offering to every major company and manufacturer on Earth. I will give you the lowest taxes, the lowest energy costs, the lowest regulatory burden and free access to the best and biggest market on the planet, but only if you make your product here in America.”
He calls that the new American industrialism. He wants to build ships, airplanes, robotics, A.I. and big electricity. Then he talked about the centerpiece of his plan. Roll the tape:
DONALD TRUMP: “The centerpiece of my plan is for a manufacturing renaissance, which will be a 15% made in America tax rate. … But now we’re cutting the business tax from 21% to 15%, which makes us the most competitive tax anywhere on the planet, but only for those who make their product in the USA. See, that’s an incentive. … And we’re going to continue with the regulatory cuts.”
Already, a couple of Republican House members have drawn up legislation for a 15% corporate tax rate, which really would make the U.S. a world-class competitor and Mr. Trump explicitly endorsed a 100% expensing write-off for heavy machinery and other equipment in the first year,
He wants full expensing for manufacturing investment, and finally, he pledges to cut 10 old regulations for every one new regulation. In his first years, he got it up to seven for one. Now he wants to go to 10 for one.
Trump’s new American industrialism is an important thematic name that ties a bow around all of his pro-growth policies. Break a leg, Mr. President. You’re coming down the home stretch.
This article is adapted from Larry Kudlow’s opening commentary on the Sept. 24, 2024, edition of “Kudlow.”
