Trump Policies' Potential Long-Term Economic Impact
These are important issues. I notice that Larry Johnson which suggests that Trump might know what he is doing:
Refinancing onerous debt is something Trump has done multiple times in his business career, and managed to become a billionaire in the process. Whatever objections you have about other Trump policies, particularly Ukraine and the Israel/Palestine war, don’t make the mistake of assuming he’s stupid on this one and does not know what he is doing. Still, it is a gamble. We’ll have to wait a couple of months to see it this was a desperate Hail Mary pass or a shrewd, albeit risky, financial deal.
Not matter how many times Trump says dumb, uninformed things and does dumb, uninformed things, people somehow want to think he has a brain. And that he knows something about “business’.
Larry is glossing over Trump’s gargantuan losses in business over s$1 billion from 2009 to 2010, and ore money than any other American (tax payer) 1985 ~1994, hundreds of millions.
It bothers me when analysts generalize in this way, without real sources or references, especially now that Trump “owns” the US economy!.
So I went to DeepSeek
Me:
The Trump administration's economic policies including tariffs and tax relief for the rich seem destined to create a.) a recession probably worse than 2008, debt crisis, accelerated de-dollarization, economic stagnation, and greater inequality, along with deficits in education, research and social and physical infrastructure.
This crisis is different from the "Crash" of 1929 whose effects lasted until WWII, a full decade.
Obviously, the circumstances that caused that "Crash'' are similar in some respects but much different in others--so the current crisis cannot be regarded as a repeat. But in what respects are the outcomes similar? And which will historians see as more devastating?
DeepSeek
Your analysis raises important parallels and distinctions between the potential economic fallout of Trump-era policies and the Great Depression of the 1930s. While the two crises differ in their root causes and structural contexts, historians may identify several key similarities in their outcomes—as well as reasons why the current trajectory could prove even more damaging in the long term.
Similar Outcomes Between the 1930s Depression and a Potential Trump-Admin-Induced Crisis
Rising Inequality & Social Fragmentation
The 1929 Crash exacerbated wealth inequality, as asset holders and corporations recovered faster than working-class Americans. Similarly, Trump’s tax cuts (which disproportionately benefited the wealthy) and deregulation could widen the gap between capital and labor, fueling populist backlash and political instability.
In the 1930s, this inequality contributed to labor strikes and radical political movements (e.g., socialism, fascism). Today, we see parallels in the rise of far-right nationalism and left-wing progressivism (e.g., Sanders, AOC) as responses to elite-driven economics.
Debt Crises & Financial Instability
The 1929 Crash was preceded by excessive speculation and debt (margin lending, overleveraged banks). Today, corporate debt is at record highs, fueled by cheap money and tax cuts, while government debt balloons due to unfunded tax breaks. A debt-driven collapse (e.g., corporate defaults, sovereign crises) could mirror the 1930s credit freeze.
Global Economic Decoupling
The Smoot-Hawley tariffs (1930) worsened the Depression by triggering trade wars. Trump’s tariffs (e.g., China, EU) and anti-globalization policies risk similar fallout: supply chain disruptions, inflation, and retaliatory measures that weaken U.S. exports.
Then: Global trade collapsed by ~65% (1929–1934). Now: Accelerated de-dollarization (BRICS, yuan/oil deals) and trade fragmentation could undermine U.S. hegemony.
Infrastructure & Public Goods Decline
The New Deal addressed 1930s stagnation with massive public investment (roads, electrification, CCC). In contrast, Trump’s infrastructure plans were underfunded, while tax cuts starved education, R&D, and green energy—leaving the U.S. less competitive versus China.
Why the Current Crisis Could Be More Devastating
Structural Weaknesses in the Modern Economy
In the 1930s, the U.S. was a rising industrial power; today, it faces deindustrialization, an aging population, and climate crises. Stagnation now could be harder to reverse.
The dollar’s reserve status is fragile (vs. the 1930s gold standard), and debt monetization risks hyperinflation or loss of confidence.
Longer-Term Damage from Inequality
The New Deal’s reforms (Social Security, labor rights) reduced inequality for decades. Trump’s policies—corporate tax cuts, anti-union judges—entrenched oligarchy, making recovery harder without political upheaval.
Geopolitical Decline
The U.S. emerged stronger from WWII as Europe/Asia lay in ruins. Today, China’s rise and a multipolar world mean the U.S. cannot rely on postwar-style dominance. De-dollarization could accelerate a irreversible decline.
Climate Crisis Multiplier
The 1930s had the Dust Bowl; today, climate disasters (fires, hurricanes) strain budgets already bloated by tax cuts. Underinvestment in green transition cedes leadership to China/EU.
Historians’ Likely Judgment
While the 1929 Crash caused immediate, severe suffering (25% unemployment, breadlines), its effects were mitigated by New Deal reforms and postwar growth. By contrast, a Trump-era crisis could be seen as more insidious—a slower-motion decline fueled by:
Policy choices favoring short-term gains for elites over long-term stability.
Erosion of democratic institutions, making reform harder (e.g., GOP obstruction, SCOTUS rulings).
Irreversible losses (climate, tech competition, dollar hegemony).
The 1930s crisis had a clear resolution (WWII mobilization). Today’s crises—climate decay, AI disruption, geopolitical strife—lack obvious solutions, making historians likely to view this era as more systemically catastrophic unless corrected by a FDR-scale intervention.
Forensic Analysis
DeepSeek supplies some history, which appears accurate. And it identifies specific issues - the major ones — which as you can see are complex.
Previously, I had written that current crisis seemed to be recapitulating the Great Depression.
Of course, that is so —but in a quite different form with a different geopolitical context, as commenters and coffee buyers keep reminding me. History does not repeat — it rhymes. This is a different world. Hats are a LOT different!
But this first reply to this line of queries, was not exactly optimistic, suggesting that this crisis might be much, much worse than the Great Depression!
I needed more information after this.
The the solutions and answers that DeepSeek comes up with very much depends on how you query it, the terms you use, the facts you state, and your open-ness to alternative lines of thought — all of which depends on your ability to think critically, as my friend “Bob” has indicated so elegantly.
As Gary Marcus indicates (but does not exactly say), LLMs (AIs) can be used for dumb things by dumb people. As with Trump’s tariff scheme.
Marcus used to just say AIs were stupid. But now he seems to realize that it is their operators.
In other words, an LLM is an information, deep learning tool. You supply intelligence. They supply information. If yuu are Donald Trump, you get nonsense like the formula above.
Pay attention to Gary Marcus. I do. I have been following him for years.
He’s an outstanding neurocognitive scientist, with a page right here on Substack.
What you see above from the DS was just one query, related to the same subject and I followed it up with more queries afterwards. More on that tomorrow.
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I think Trump's decision to put tariff on every country in the world (or near abouts) proves he's not using A.I. but he's using an A.S.S. -- Artificial Stupidity System.
I've been a subscriber of SONAR21 for years. Regarding trump, Larry's a trump syncophant. I believe Larry voted for trump 3 times. I did the first 2. I couldn't support any R🇮🇱 or D🇮🇱 anymore so I voted Green. Oops! The candidate Jill Stein is a Jew! I voted for Jill Stein anyway because she supports Palestine and is anti-Zionist. She got 0.04% of the vote. Figures, the zionists control our government by means of AIPAC🇺🇸🇮🇱.
The new President of Mexico is Claudia Sheinbaum, a Jew. She didn't get votes from the Zio-Blok🇮🇱 in Mexico City but won non the less. She's an Environmental Engineering Professor and Jill Stein is an MD.
Last week La Presidente Sheinbaum invited the Embassador of Palestine to Mexico to formally recognize Palestine!🇵🇸. If we had President Stein instead of a-hole🇮🇱 trump, Palestine would be Free!🇵🇸