Ask A Genius 952: Round Two! President Biden and Former President Trump
Author(s): Rick Rosner and Scott Douglas Jacobsen
Publication (Outlet/Website): Ask A Genius
Publication Date (yyyy/mm/dd): 2024/06/17
Rick Rosner: Part two of the discussion on Trump versus Biden focuses solely on Trump. I argued this morning on PodTV that Trump aims to replace taxes with tariffs, which is a disastrous idea. It’s highly inflationary as most costs get passed on to consumers. For example, if a $10,000 tariff is imposed on cars from Japan or China, these countries will increase their car prices by $10,000 when selling to the US. This leads to higher prices overall because if every Japanese car suddenly costs $10,000 more, American car manufacturers can raise their prices by $5,000. This approach is inherently inflationary.
I asserted that Trump is incompetent in business and consistently makes poor decisions. Between 1985 and 2015, Trump lost more money than any other American. This includes extracting money from a business, declaring bankruptcy, and defrauding investors. During a debate, someone argued that this strategy is reasonable given the US tax system. I conceded that Trump could extract money for personal use, then declare bankruptcy, avoid taxes, and essentially keep the extracted funds. However, his poor business acumen extends beyond this.
When his Atlantic City casinos went bankrupt, it was due to bad business decisions. He simultaneously opened three casinos, causing internal competition. Atlantic City was already in decline, facing competition from newly legalized gambling in other states. Investing in Las Vegas, which was growing, would have been wiser. His Atlantic City casinos catered to low-spending visitors, primarily senior citizens taking free buses from New York City.
From 1995 to 2005, the stock price of Trump’s casinos plummeted by 89%, whereas the Dow Jones casino index rose by 160%, and other casino companies saw significant gains. Trump’s investors lost most of their investments, with the remaining value eventually dropping to zero.
Trump’s organization is small, comprising only six people, and he doesn’t rely on advisors. As an undergraduate, he attended UPenn’s Wharton School, often misleadingly implying he went to the prestigious Wharton Business School. One of his Wharton professors even described him as the dumbest student he had ever taught.
In summary, Trump’s economic ideas are fundamentally flawed and have a track record of poor decision-making.
Scott Douglas Jacobsen: Where does Biden make mistakes on the economy?
Rosner: At least Biden has a competent cabinet and advisors. Critics, particularly old-school Republicans, accuse Biden of overspending and increasing the deficit. Trump, however, also significantly increased the national debt by $8 trillion, with tax cuts for the wealthy and corporations, as well as substantial COVID relief measures.
Biden has invested trillions in infrastructure, which Republicans argue includes unnecessary spending, often referred to as “pork.” Pork refers to spending seen as excessive, such as a $1.4 million grant for an LGBTQ community center in New York City included in an infrastructure bill. Critics argue that rural internet projects should be privately funded rather than government-financed.
Despite criticisms, initiatives like student debt relief, costing a few billion dollars, have long-term benefits. After Sputnik, the US invested heavily in math and science education, which was costly but ultimately led to technological leadership and substantial economic gains.
As we advance in AI and other high-tech fields, the US should lead in innovation, developing technologies like AI, immortality medicine, and solutions for climate change. Achieving this requires an educated population capable of driving and maintaining technological advancements.
That’s all for now. My voice is going. Let’s continue later tonight.
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