Trump Is Struggling With His Treasury Pick for the Dumbest Reason
Presidents of both parties err on the side of caution whenever they appoint a treasury secretary, going back all the way to Alexander Hamilton (who, pace Lin-Manuel Miranda, was as beholden to the banks as Tim Geithner). The current officeholder, Janet Yellen, is the most left-wing treasury secretary since World War II, but that doesn’t tell you much; in February 2022 the left-liberal Robert Kuttner declared Yellen “the big disappointment of the Biden administration” because of her “profound status-quo bias” on regulatory matters. Yellen, like all her predecessors and whoever replaces her, is the Oval Office’s designated babysitter for Wall Street, tasked less with disciplining it (that’s more the job of the Securities and Exchange Commission, the Commodity Futures Trading Commission, and the Fed, none of which reports to the Oval Office) than with soothing its periodic squalls with a warm bottle of Enfamil.
Trump’s quandary is one he was spared last time he was elected, back in 2016, when he chose Steve Mnuchin for Treasury. Back then, Trump needed somebody who could sell Wall Street on tax cuts and reduced regulation. That wasn’t an especially hard task because to the extent that these policies screwed up the economy, they did so in ways that Wall Street doesn’t especially care about.
Mnuchin had to work a little harder selling Wall Street on protectionist trade policies, but only a little, because the protectionism was concentrated mostly on China, a notorious trade scofflaw. In the end, the main effects of Trump’s trade policies were to eliminate 245,000 American jobs and to shift manufacturing from Chinese plants in China to Chinese plants in Vietnam. But neither of these outcomes mattered to Wall Street.