Trumpenomics: The Emperor Has No Clothes

President Donald Trump calls himself a master of deals and a builder of wealth. But a closer look at his economic record shows otherwise. What passes as Trumpenomics is not a coherent strategy but a dangerous cocktail of trickle-down economics, tariffs, authoritarian force, and outright deception. The emperor struts confidently, yet his economic clothes are invisible.

Trickle-Down Economics with Tariffs

Trump’s policies leaned heavily on Arthur Laffer’s supply-side theories, promising that tax cuts for corporations and the wealthy would lift all boats. The 2017 Tax Cuts and Jobs Act slashed the corporate tax rate from 35% to 21%, showering disproportionate benefits on the top 1%. The Congressional Budget Office found that by 2025, households making under $30,000 would actually see tax increases, while millionaires reaped permanent benefits.

At the same time, Trump imposed tariffs on China and other trade partners—despite claiming to be a free-market champion. Tariffs raised consumer prices at home, effectively acting as a hidden tax on working families. The Federal Reserve estimated that U.S. consumers and businesses bore nearly the full cost of Trump’s tariffs, with average households paying hundreds of dollars more each year for basic goods.

Demanding Tributes from Other Nations

Trump approached international trade less as economic policy and more as a tribute system. Nations that purchased U.S. arms, invested in Trump-friendly industries, or flattered his ego received preferential treatment. Those who did not were threatened with tariffs, sanctions, or military abandonment. His decision to reduce funding to NATO while deepening ties with Saudi Arabia, Qatar, and the UAE reflected this transactional worldview.

Altering Economic Data and Scapegoating the Poor

Trump consistently attempted to alter or spin economic data. When unemployment spiked during COVID-19, his administration pressured agencies to downplay the crisis. In some cases, career economists reported being silenced or reassigned for refusing to misrepresent figures.

When numbers could not be manipulated, scapegoats were manufactured. Trump blamed immigrants, people of color, and the poor for economic stagnation, while targeting Medicaid recipients and the homeless as symbols of “decay.” Instead of addressing structural problems, his rhetoric diverted public anger downward, away from billionaires and corporations.

Lie, Cheat, Steal

Lawsuits and corruption have always been central to Trump’s business empire, and they carried over into his economic governance. From funneling taxpayer money into Trump-owned properties to bending trade policy for donors, his approach blurred the line between public service and private gain. The New York Times documented that Trump paid just $750 in federal income tax in 2016 and 2017, even as he claimed to be a champion of the American worker.

Fourth Generation Warfare, AI, and Taiwan

Trump’s economic worldview also bleeds into Fourth Generation Warfare (4GW)—the mixing of political, economic, and psychological operations. His chaotic handling of AI development, threats over Taiwan, and erratic China policy destabilized global markets. Uncertainty became a feature, not a bug: allies and rivals alike never knew if Trump’s economic positions were bargaining tools, retaliations, or improvisations.

Authoritarianism at Home and Abroad

At home, Trumpenomics relied on force and intimidation. He threatened to deploy the National Guard against protesters, treating dissent as an economic threat to be neutralized. Abroad, he backed Netanyahu’s expansionist policies while cutting aid to Europe, effectively reshaping U.S. alliances around authoritarian partners willing to pay for loyalty.

Hostility Toward Higher Education

Trump also targeted higher education, cutting research funding, undermining student protections, and ridiculing universities as bastions of “elitism.” The move was both political and economic: by weakening critical institutions, he expanded the space for propaganda and disinformation to thrive.

The Emperor’s New Clothes

Beneath the spectacle, Trumpenomics have left the US more unequal, more indebted, and more divided. The federal deficit ballooned by nearly $7.8 trillion during his first term—before COVID-19 relief spending. Inequality widened: by 2020, the richest 1% controlled more than 30% of the nation’s wealth, while median household income gains evaporated. Tariffs have raised costs, tax cuts hollowed out revenues, and corruption flourished.

Trump’s economy was not built on strength but on illusion. Like the emperor in Hans Christian Andersen’s fable, Trump strutted in garments only his loyalists claimed to see. For everyone else, the truth was painfully visible: the emperor had no clothes.

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Sources

• Congressional Budget Office, “The Distributional Effects of the 2017 Tax Cuts” (2018)

• Federal Reserve Board, “Effects of Tariffs on U.S. Consumers” (2019)

• The New York Times, “Trump’s Taxes Show Chronic Losses and Years of Income Tax Avoidance” (Sept. 27, 2020)

• David Cay Johnston, It’s Even Worse Than You Think: What the Trump Administration Is Doing to America (2018)

• Joseph Stiglitz, “Trump’s Economic Nonsense,” Project Syndicate (2019)

Trump’s “Manhattan Project” for AI Chips: U.S. Scrambles as China Reaps Neoliberal Legacy

The Trump administration is reportedly considering an extraordinary intervention in the private sector: partially nationalizing Intel Corp., one of America’s leading semiconductor manufacturers. Sources say the government is exploring a stake in the company—a move experts liken to the Manhattan Project or the early space race.

MIT AI computer scientist Dave Blundin described the effort on a podcast with MIT engineer Peter Diamandis as “every bit as important as the space race was, as the nuclear arms race was. Actually, it’s more important.” Intel’s advanced semiconductor capabilities could reduce U.S. dependence on foreign fabrication plants, particularly in Taiwan, which controls more than 60 percent of global chip production.

Decades of Missteps

Yet the urgency behind the move is rooted not in technological inevitability, but in decades of strategic missteps. Neoliberal policies pursued by U.S. administrations and corporate elites deliberately outsourced manufacturing and critical technology to China to cut labor costs. Over time, this strategy handed Beijing a decisive advantage in semiconductors, AI, and advanced technology, leaving the United States reactive and vulnerable.

The potential nationalization of Intel—a step usually reserved for wartime or extreme crises—signals a dramatic departure from free-market principles. By directly involving the federal government in a major private firm, the administration privileges corporate elites, bypassing both market competition and public accountability. Intel declined to comment on the discussions but emphasized its commitment to supporting the administration’s technology and manufacturing priorities.

China and Taiwan

Blundin warned the move puts the industry on a “war footing,” likening it to a mobilization for conflict, with supply chains and fabs as the battlefield. Analysts stress urgency: China may attempt to take over Taiwan sooner rather than later. Unlike the United States, China operates under a coordinated, authoritarian system that fuses government strategy and industrial capacity to dominate global technology—a stark structural advantage over the fragmented, elite-driven U.S. approach.

Recent deals highlight the U.S.’s reactive posture. Last week, Nvidia and Advanced Micro Devices (AMD) agreed to hand over 15 percent of their chip sales revenue in China to the U.S. government in exchange for export licenses. Experts warn that while these arrangements provide short-term financial gains, they also strengthen China’s AI and military capabilities. Liza Tobin, former China director at the National Security Council, called the deal “an own goal” likely to incentivize Beijing to escalate its technology development and demand further concessions.

Trump has also threatened a 100 percent tariff on imports unless chips are manufactured domestically. If Intel is partially nationalized, it would mark one of the most significant government interventions in U.S. industry in decades—demonstrating both a departure from free-market capitalism and a concentration of power in the hands of elites.

The U.S.’s current scramble illustrates a deeper crisis. Decades of neoliberal policies, elite capture, and weakening democratic institutions have left the nation ill-prepared to compete against a strategically unified authoritarian China. Semiconductor leadership is no longer just an economic or technological matter—it is a test of whether the United States can reclaim strategic sovereignty while defending democracy and free-market principles, or whether it will continue to lose ground to authoritarian advantage.

Sources: Bloomberg, Financial Times, The New York Times, MIT Podcast with Dave Blundin & Peter Diamandis

How China Can Respond to America's Tariffs (Michael Hudson)