Forbes political economy editor John Tamny gave the new U.S. president a mixed report card at the Cayman Economic Outlook conference on Feb. 2. Taking a pro-immigration, anti-tax stance, he ranked President Donald Trump’s ideology from good to “quite simply terrifying.”
He pointed to the diverse, international community in the Cayman Islands as an economic driver for the nation and encouraged the United States to continue embracing immigrants who bring with them “essential knowledge, drive and ambition.”
“There is talk today that somehow immigrants and immigration are the source of economic stagnation. Nothing could be further from the truth,” he said at the Kimpton Seafire Resort and Spa in Grand Cayman.
“If America is to remain the greatest country in the world, it must welcome immigrants. If we somehow close our borders to them, we will no longer be great because we will no longer be what made the country great in the first place.”
Tamny warned against rhetoric that pins job losses on immigrants, and said rather, ambitious immigrants are magnets for job-creating investment.
To be most effective for the nation, he encouraged President Trump to spend more time working on his golf technique than tinkering with the economy.
“If (U.S. presidents) would just play golf for most of their time in office, things would be more prosperous,” he said, transitioning to his anti-regulatory philosophy.
He praised President Trump for his plans to reduce corporate taxes and eliminate the estate tax.
“Taxes are nothing more than a price or penalty placed on work. So in an ideal world, the tax rate would be as low as possible. You do not want to penalize people for getting up and going to work every day,” he said.
He said economic growth would be “blindingly easy” if governments were to implement minimum taxation, resort to bare-bones spending and cut regulations.
“Regulation does not work. Let’s be even more clear: regulation cannot work. If you doubt me, all you need to do is go back to 2008 and observe the global banking sector,” he said.
Tamny said it is the rich alone who are able to fund progress through their investments. He described taxes on them as a penalty placed on their success.
Regarding President Trump’s interest in devaluing the U.S. dollar, he warned of provoking another global crisis.
“Investment is the biggest driver of falling prices and devaluation is the biggest enemy of investment,” he said.
“What (President Trump) doesn’t know about currency could fill books.”
Rather than encouraging American exports, he said the U.S. would risk a negative ripple effect across the globe, starting with its own workers.
“Do you think workers will sit back while their check is eviscerated?” he asked.
He pointed to how U.S. banks have handled President Trump since the 1990s, viewing him as “toxic” and a major credit risk that few are willing to touch.
In general, however, he described credit through U.S. banks as experiencing a free fall, representing 15 percent of credit in the nation. He attributed the decline to the banking bailout as well as to regulation.
For offshore financial centers like the Cayman Islands, he sees an opportunity to move in and capitalize on opportunities that U.S. banks cannot or will not touch.