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US Economic Outlook: 2017 and Beyond Matthew C. Roberts, PhD | - - PowerPoint PPT Presentation

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US Economic Outlook: 2017 and Beyond Matthew C. Roberts, PhD | www.kernmantlegroup.com 13 Dec 2017 Stephen Colberts Tips on Being an Expert (Wired Magazine, August 2006) Pick a field that cant be verified Be sure to use lots of

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Matthew C. Roberts, PhD | www.kernmantlegroup.com

US Economic Outlook: 2017 and Beyond

13 Dec 2017

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Stephen Colbert’s Tips on Being an Expert

(Wired Magazine, August 2006)

  • Pick a field that can’t be verified
  • Be sure to use lots of abbreviations

and acronyms

  • Don’t be afraid to make things up
  • Don’t limit yourself to current

knowledge

  • Get an honorary PhD
  • Make a habit of name-dropping
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US Wealth Continues to Rise: Disposable Income

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Recovering Growth Means…

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Ripped from the headlines…

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Because everyone likes to talk $BTC

  • Blockchain will become more common in clearing many

sorts of transactions.

  • The biggest challenge is how to compensate hosts for

maintaining ledgers in a sustainable way.

  • The current run-up is almost certainly a bubble.
  • In the long-run, BTC (ethereum, etc) will play a role like

gold—store of value, difficult to trace

  • But much, much better
  • There are many problems with BTC’s implementation:
  • Power usage
  • Loss
  • Anonymity
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Matthew C. Roberts, PhD | www.kernmantlegroup.com

Some Policy Thoughts…

13 Dec 2017

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What can we learn from History?

  • Single-party government is not the same as unified

government.

  • 111th Congress: (2009-2011)
  • DNC had House majority and 60 in Senate
  • POTUS had to negotiate for ACA very hard and make

significant concessions to win Lieberman & Nelson’s Senate votes.

  • 35 Ds in House voted against ACA.
  • 103rd (1993-1995)
  • DNC had House majority, 57 in Senate
  • HillaryCare didn’t make it out of committee.
  • No significant partisan D ‘win’:
  • FMLA
  • RFRA
  • NAFTA
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Single-Party Congresses, cont’d:

  • 107th, 108th, 109th (2001-2007)
  • GOP had House majorities, 50-55 Senators
  • 107th:
  • Pre 9/11 tax cuts
  • Sarbanes-Oxley
  • Patriot Act
  • 108th:
  • Medicare Schedule D benefit
  • 109th:
  • Bankruptcy Reform
  • CAFTA
  • Energy Policy Act of 2005
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The Problem with Single-Party Rule:

  • Compromises are still required, and both parties

have many factions.

  • This means that cross-cutting legislation, like Farm

Bill, might be easier to pass than partisan laws.

  • Farm Bill has some natural D constituencies, and some

staunch GOP opponents.

  • Same can’t be said for tax reform, regulatory relief,

ACA repeal, etc.

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Six Points:

  • Farm Bill Won’t Change Much
  • Tax Reform Modest
  • If it even passes…
  • ACA
  • Trade is the big Unknown
  • Regulatory Relief
  • Gridlock & the Economy
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What will happen with trade?

  • This is biggest area for concern.
  • Is the administration:
  • Anti-trade?
  • Attempting a master plan of obfuscation to drive a deal?
  • This matters:
  • 25% of corn exports (548m bu) to Mexico
  • 62% of soybean exports (1.3bn bu) to China
  • Japan, S. Korea & Mexico were largest US beef buyers
  • Japan, Mexico & Canada
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What are the President’s Trade Powers?

  • There is still disagreement over what the President

alone can actually do…

  • Notify intention to withdraw (NAFTA & KORUS)
  • Instruct CBP to interfere?
  • But will Congress actually withdraw?

“The Congress shall have Power […] [t]o regulate Commerce with foreign Nations…”

(Article I, Section 8, Clause 3)

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Regulatory Relief

The one place that Ag clearly has, and should continue, to benefit:

  • WOTUS
  • Labor
  • Other EPA
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This might not be all bad.

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And maybe that’s a good thing.

  • 1995-2000: Gridlock in DC, enmeshed in Lewinsky

Scandal.

  • 2003-2007: From 2004 on, Bush 43 got nothing

done—public & congressional opposition to the war, etc.

  • 2013-2016: Completely obstructionist Congress.
  • Stability matters.

When has economy grown fastest?

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Matthew C. Roberts, PhD | www.kernmantlegroup.com

Some Ag Thoughts…

13 Dec 2017

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Matthew C. Roberts, PhD | www.kernmantlegroup.com

Questions?

13 Dec 2017