Sen. Elizabeth Warren is openly warning of an economic disaster headed our way (something I definitely agree with her on) saying that legislation is needed now in order to stave off the worst of the coming recession's effects.
“Warning lights are flashing. Whether it’s this year or next year, the odds of another economic downturn are high — and growing,” Warren (D-Mass.) wrote in a Medium post entitled "The Coming Economic Crash--And How to Stop It."
“I see a manufacturing sector in recession. I see a precarious economy that is built on debt — both household debt and corporate debt — and that is vulnerable to shocks. And I see a number of serious shocks on the horizon that could cause our economy’s shaky foundation to crumble,” she wrote.
Most of Warren’s proposals to head off the crisis are policies she has called for recently on the campaign trail such as forgiving over $600 billion in student loan debt, enacting her “Green Manufacturing Plan”, strengthening unions, providing universal child care and raising the minimum wage to $15 an hour.
It is almost certain that President Donald Trump will not sign and the Republican-led Senate will not pass these policies, meaning that Warren’s prediction of a crash will likely be tested over the next two years.
The Democratic presidential candidate’s forecast of economic tumult flies in the face of much political conventional wisdom stating that Trump’s biggest re-election advantage is the economy. Unemployment levels recently hit a 50-year low, the majority of Americans think the economy is “good” or “excellent” and that it‘s a good time to find a job according to Gallup. The stock market continues to break records every few months.
The Trump administration and Republican allies in Congress often point to the economy’s performance as evidence of the president’s good stewardship even in the midst of self-created controversies and divisive policies. Trump himself often brags about the economy as well. Just last week on Twitter, he said the economy was “the best in our Country’s history” with the “Best Employment & Stock Market Numbers EVER”and that he has led the United States to the “Greatest Economic BOOM in the history of our Country.”
But Warren has long been arguing that the economy is not as strong as the toplines suggest. “The overall numbers about GDP or the stock market are great but they don’t reflect the lived experiences of most Americans,” she told reporters in May after a town hall in Nashua, N.H. “Go around a room like this. For most people, wages haven’t gone up in a generation and yet the cost of housing, the cost of health care, the cost of childcare, the cost of sending a kid to college have all gone through the roof. The middle class squeeze is real and it has gotten tougher for people over the last few years.”
Warren is correct on both accounts, and the warning signs in the bond and corporate lending markets are screaming alarms that we're in a 2006 scenario ahead of another 2008 meltdown. And of course, the Trump regime's lax regulation of banks have only made this much worse.
Either way, we'll see if Warren is correct, because the Trump regime has no intention of passing anything.