Analysis | In Larry Kudlow, Trump sees a loyalist

If President Trump really does pick CNBC’s Larry Kudlow to replace former Goldman Sachs exec Gary Cohn as director of the National Economic Council, he’ll have gotten someone who will give him pretty much the same advice but is much more willing to publicly say what Trump wants him to.

Kudlow, you see, is as standard a Wall Street Republican as you’ll find. He believes in the Reaganite Holy Trinity of low taxes, low inflation and free trade. He believes in them so much that he’s spent the better part of the last 20 years proclaiming them on TV and radio. If that — minus the whole media personality part — sounds a lot like Cohn, that’s because it is. The two of them have spent the past year and a half saying almost exactly the same things.

Like Cohn, Kudlow thinks that Trump’s corporate tax cuts are going to supercharge the economy so much that the whole thing will “pay for itself,” despite the fact that the nonpartisan Joint Committee on Taxation, much like every other mainstream forecaster, estimates that it’s going to add at least $1 trillion to the nation’s debt. And also like Cohn, Kudlow has said that Trump’s tariffs are a bad idea that show a “crisis of logic” since they are “really tax hikes” on Americans.

The biggest difference between them is that Kudlow is much more willing to spin things when they’re not going like he hopes. He always has been. Back in 2005, when fear of a housing bubble was beginning to cast doubt on President George W. Bush’s economic accomplishments, Kudlow said that “all the bubbleheads who expect housing price crashes in Las Vegas or Naples, Florida, to bring down the consumer, the rest of the economy, and the entire stock market” were “dead wrong.”

Two years later, when everything he said wouldn’t happen was happening, he dismissed it again.

“There’s no recession coming,” Kudlow wrote, which was especially poor timing given that economists would later decide this was exactly the moment the recession had begun. To admit otherwise would be to admit that Bush’s combination of tax cuts and deregulation hadn’t worked, and Kudlow wouldn’t do that. So instead he looked for any evidence, no matter how unconvincing, that “the Bush boom is alive and well.”

It’s this ability to explain every inconvenient fact away that makes a free-trader like Kudlow a good match for a protectionist like Trump. Indeed, Kudlow has already tried to argue that these aren’t tariffs so much as negotiating tactics, and, as such, his “hat’s off” to Trump for his cunning.

It’s part of what separates Kudlow from Cohn, Kudlow’s longtime friend and frequent collaborator Stephen Moore told the Wall Street Journal: his steadfastness. “Larry would be loyal to the president when the decision is made,” Moore said, so even if he doesn’t really agree with that decision, such as tariffs, he’d be willing to “stand by the guy you work for.”

So if Kudlow gets the job, we’ll get a White House that makes unrealistic promises about the tax cuts it believes in and the tariffs it doesn’t. A White House that, as National Trade Council Director Peter Navarro put it recently, believes its job is to “provide the analytics that confirm” Trump’s “intuition,” since “his intuition is always right in these matters.” A White House that tries to act like 280-character outbursts are coherent policy.

Trump only hires the best people who tell him he’s a genius.

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