The Economy (Summary)

Author: Project 2025 Editors

Summary

• The chapter emphasizes the importance of prioritizing the economic prosperity of ordinary Americans, highlighting the failure of establishment elites in securing the border, managing manufacturing, and controlling government spending.
• The debate on trade policy between Kent Lassman and Peter Navarro is central to the chapter. Lassman advocates for a limited-government approach that encourages free trade, arguing that aggressive trade policies could lead to negative consequences like increased government control and economic decline.
• Lassman also suggests that tariffs, such as those implemented by the Trump Administration, have harmed manufacturing jobs more than they have helped, and advocates for lowering or repealing tariffs to enhance economic stability and national security.
• Navarro, in contrast, supports a more protectionist trade policy, emphasizing the importance of reviving American manufacturing and defense industries. He criticizes the World Trade Organization’s rules and China’s economic aggression, arguing that these factors harm the U.S. economy and national security.
• Navarro also advocates for a trade policy guided by reciprocity, urging the U.S. to decouple its economy from China to protect American interests.
• The Export–Import Bank is debated by Jennifer Hazelton and Veronique de Rugy. Hazelton supports the bank for its role in providing financing when the private sector cannot, while de Rugy criticizes it as a protectionist agency that picks winners and losers in the market.
• Thomas F. Gilman critiques the Department of Commerce for being dominated by career staff uninterested in implementing the President’s priorities, highlighting the need for more political leadership, especially in the Census Bureau and the International Trade Administration.
• The Treasury Department is criticized for failing to achieve its core objectives under the Biden Administration, with a recommendation for a refocus on economic growth, prosperity, and balancing the federal budget.
• Proposals include tax reform to simplify the tax code, reduce marginal tax rates, and promote economic growth. Additionally, reforms to the Internal Revenue Service and the Committee on Foreign Investment in the United States are suggested to protect against foreign threats.
• Karen Kerrigan criticizes the Small Business Administration for waste and mismanagement, advocating for reforms to promote economic freedom and opportunity for small businesses.
• Paul Winfree discusses the Federal Reserve’s role in creating economic instability and suggests radical reforms, including possibly abolishing the Federal Reserve and considering a return to the gold standard.

Analysis

• If the U.S. government were to adopt Lassman’s free trade approach, it might lead to lower consumer prices and improved diplomatic relations but could risk the loss of domestic manufacturing jobs and increased reliance on foreign goods.
• Implementing Navarro’s protectionist policies could strengthen domestic industries and national security but might provoke trade wars, increase consumer costs, and strain international relations, particularly with China.
• Abolishing the Export–Import Bank could reduce government intervention in the market but might weaken the competitive position of U.S. businesses in global markets, especially against state-supported competitors from China.
• Reforms in the Department of Commerce and the Treasury could streamline government operations and refocus efforts on economic growth, but might also face resistance from entrenched bureaucratic interests and political opposition.
• Radical changes to the Federal Reserve, including its potential abolition, could lead to significant economic disruptions, but might also create a more stable and transparent monetary system in the long run.

Tags

• Trade Policy
• Economic Reform
• U.S.-China Relations
• Federal Reserve
• Small Business

Read the original chapter text here: https://static.project2025.org/2025_MandateForLeadership_FULL.pdf#page=690

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