Larry Kudlow, economic advisor to Donald Trump and CNBC contributor, says the President elect needs to have “if not a bipartisan cabinet, a bipartisan attitude.”
Kudlow, author of the new book, “JFK and the Reagan Revolution: A Secret History of American Prosperity,” noted in a recent interview with me that both Kennedy and Reagan did so.
“Kennedy had three Republicans in senior cabinet jobs [Robert McNamara, McGeorge Bundy and Douglas Dillon],” Kudlow says. And he adds “…turn the clock forward with Reagan—and I was there in Reagan’s first term as a budget deputy. The Republicans had the Senate but the house was Democratic big time and Tip O’Neill, the speaker of the house, was very much opposed to the tax cuts [and Reagan wooed him.]”
Kudlow says this is certainly pertinent today: “My point here is I believe Trump, having a J.F.K./Reagan type tax cut program, which I strongly support and help to work on, cannot [succeed] unless he sells it across the aisle. The theme of bipartisanship and the theme of civility is a very important.”
Trump is reportedly considering Kudlow to lead the White House Council of Economic Advisers, a role held previously by the likes of Ben Bernanke, Janet Yellen, and Alan Greenspan and is currently occupied by economist Jason Furman. The Wall Street Journal recently endorsed Kudlow for the role, noting that as an ardent free trader Kudlow would provide balance for the likes of Trump’s pick to run the White House Trade Council, the protectionist economist Peter Navarro.
“Trump understands the benefits of trade.”
I asked Kudlow, who last year wrote a piece titled “Why Trump’s protectionist ways will hurt the economy,” why he was now less concerned about Trump’s protectionist ways.
“I believe that Trump understands the benefits of trade,” Kudlow tells me. “He himself in his business has done a lot of international trading and overseas work. I think that Mr. Trump first and foremost would like to renegotiate some pretty lousy trade deals. Particularly China but also Mexico. He is [all about] the art of the deal. He is not against trade at all but he is in favor of fair trade and enforcing treaties. I believe that it’s a carrot and stick.”
“He will go to China [and] Pacific Rim countries and he will say ‘we are going to make a better deal and that deal is going to be in your interest but in our interest too.’ He will not want international government bodies. America has to act in its own self-interest. He will insist on following the rules. As you know China steals intellectual property rights left and right. They’re unreliable. He will insist on tax fairness taxi equality. That’s a huge issue with Mexico and China. Mr. Trump would only use tariffs as an absolute last resort not as a first resort,” Kudlow says.
“We’re never going to revive 1950s manufacturing.”
As for manufacturing, Kudlow says, “We’re never going to revive 1950s manufacturing. On the other hand we have a first rate energy sector which is all about manufacturing and Trumps is going take the handcuffs off that —including President Obama’s most regrettable regulatory initiative—offshore drilling.”
The result according to Kudlow? “I think you will see faster growth. If you start lifting costly regulations, you will see companies come alive. You’ll see animal spirits come alive. The incentive model works in my view and that’s your biggest job creator is a faster growth rate.”
I also asked him if economic policy could actually bring the nation back together? “Growth heals,” he says. “Growth is enormously important for our attitudes. I think the best way to do this is to have bipartisan support for the tax cut and to reach across the aisle. I really do. We need greater civility in our public discourse and our politics. I’ve worked with Republicans and Democrats my whole career.”
Interesting to note that Kudlow, known for sometimes being combative as television commentator, is now the one talking about offering the olive branch.