Memo To Trump: Get Focused On The Economy, Before It’s Too Late

 Conservatives have been positively giddy with the whirlwind of activity out of the White House over the past five weeks. But if President Donald Trump and Republicans in Congress don’t start focusing on the economy, the excitement will be short-lived.

Not only are there worrisome signs of an economic slowdown, but the public is growing increasingly frustrated with what they see as a lack of attention to pocketbook issues on Trump’s part. Republican lawmakers are making matters worse by dawdling on extending Trump’s tax cuts, which is causing businesses to hold off on big investments. This is a lethal combination.

The latest sign the economy continues to struggle comes from the GDPNow, produced by the Atlanta Federal Reserve Bank, which projects GDP growth for each quarter based on currently available data, and changes as those data roll in. Data released on Monday caused a sharp downgrade in GDPNow forecast to -2.8% for the quarter, from -1.5% last Friday.

Meanwhile, the Consumer Confidence Index dropped sharply in February and “pessimism about the future returned,” according to the Conference Board.

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The latest I&I/TIPP poll finds that 76% of those surveyed are concerned about an economic slowdown, with 45% saying they are “very concerned.” And 82% are troubled about inflation.

(We will have a complete report Wednesday on the poll’s findings.)

In other words, we are not out of the woods yet.

Here’s the worrisome part.

The public doesn’t think Trump is as focused on the economy as he should be. The I&I/TIPP poll found that just 45% say he’s “giving enough attention to economic issues.” Among independents, it’s just 38%.

Two other recent polls found the same thing. A CBS News/YouGov poll found that 80% of adults say Trump should concentrate more on the economy and inflation. And a CNN poll found that only 40% say Trump has the right priorities.

Those perceptions aren’t the result of media bias. As far as we can tell, Trump has said very little about the economy, but plenty about DOGE, tariffs, border security, Ukraine, and DEI. These are all legitimate issues, but they aren’t why working-class Americans voted Trump into office.

Don’t get us wrong, we are not suggesting that it’s somehow Trump’s fault if the economy is struggling. He’s been in office for only five weeks, and what we are seeing right now is the bitter end of the economic wreckage that Joe Biden’s tax-spend-and-regulate policies caused.

Trump hasn’t exactly helped things, however. As American Enterprise Institute economist Michael Strain put it: “All the uncertainty around trade policy, uncertainty around some of the things that the Department of Government Efficiency is going, I think will have a chilling effect on investment plans and expansion plans.”

But it doesn’t matter that Trump isn’t to blame for any near-term economic problems. He will be blamed. By every Democrat. By every mainstream media outlet. By every late-night talk show host, celebrity and internet troll. The echo chamber will be busy.

The press is already doing its part. Witness Margaret Brennan of “Face the Nation,” who pressed Treasury Secretary Scott Bessent on the economy, saying “Our polling also shows at least half the country reports concern about paying for food and groceries and housing. They continue to call the economy bad, even more so than last month, and 49% told us the economy is getting worse.” She then demanded to know when Trump was going to fix it.

Bessent responded by saying: “You know, Margaret, what I find interesting is, for the past year-and-a-half and during the campaign, most of the media said, oh, the economy is great, it’s just a vibe session. Now that President Trump’s in office, there’s an economic problem.”

This is, by the way, exactly as we predicted right after Trump was elected, when we said that the news media would immediately switch from “The economy is doing great!” to “Why hasn’t Trump fixed the economy yet??” (See “What’s In And What’s Out After Trump’s Stunning Victory.”)

Bessent is right, too, to point out that it took four years of Biden to get into this mess.

But this is a perception problem. One that only Trump can address.

Trump and company need to show to the public that they are on top of this – before bad news strikes. Responding to it after the fact will accomplish nothing. What’s more, it will cause Republicans to start running for the hills if the blame-Trump mantra starts to sink in.

That means spending less time blaming Biden and more time talking about his plans to repair the damage and get the economy moving again. Talk about his plans to free the economy from regulatory shackles. Unleash America’s energy. Cut the gargantuan national debt. Simplify taxes. And help the public understand that it will take time for his policies to work (like Reagan did with his “stay the course” mantra during the 1981 recession).

There’s good news to share. At Monday’s press briefing, for example, Trump announced a $100 billion investment by a Taiwanese chipmaker. Earlier Apple announced plans to spend $500 billion in the U.S. We need more talk like this, more often.

Trump has an opportunity to get started on this messaging campaign in tonight’s address to Congress. We hope he takes it.

https://issuesinsights.com/2025/03/04/memo-to-trump-get-focused-on-the-economy-before-its-too-late/

Cuts to Indirect Federal Grants Could Change Research for the Better

 On February 7, the National Institutes of Health (NIH) announced that it will be reducing its negotiated proportion of grant funding that goes to overhead, or “indirect costs,” to 15 percent across the board. 

Indirect costs are basically fungible dollars that a research institution can spend however it wants. They are meant to cover all the ancillary services that researchers need, like human resources, information technology, buildings and grounds, and so on. When private foundations give grants, they generally require that 80, 85, or even 90 percent of the funding go to direct services, like research for research grants, so the new NIH rule finally puts the federal government in line with the private sector.

Last year, the NIH spent 26 percent of its research grants on indirect costs, and some institutions (including Harvard, Yale, and Johns Hopkins) received more than 60 percent of their direct costs for indirect costs. In other words, more than a third of the money they received to do research didn’t go directly to research.* The reduction of indirect funding should save taxpayers as much as four billion dollars a year. 

It still isn’t clear whether the move is lawful or not. Sen. Susan Collins reportedly claims it isn’t. I’m not an expert on constitutional law, but I am equipped to discuss the policy merits of the change.

Scientists are claiming that the cuts will “decimate basic and clinical research” and “are detrimental to academic biomedical research,” while economists tout “the case for government funding of basic research.” Reporters cover the political angle: “NIH funding cuts cause concern in Alabama.” A Brandeis professor even touted Hitler’s allegedly stellar record in funding German research in a piece for a progressive magazine to make the case why Trump needs to reverse the NIH rule. (If you’re confused as to why he would reach for Hitler of all people as his preferred example, you’re not alone.)

Government spending cuts are never easy, but this one really has sent the PhD class into a tizzy. But from the standpoint of the beleaguered American taxpayer, are these cuts a good idea or not?

Some economists will defend government funding of basic research as something that benefits the taxpayer. Basic research doesn’t pay, so the argument goes, but it’s valuable because the private sector can build on it. It’s a nonexcludable good that everyone can access, but for which no one has an incentive to pay. Compulsory payment for the good through taxes, therefore, will supposedly make everyone better off.

Now, it might be an interesting philosophical discussion whether all government science funding should be abolished, but that’s not what’s on the table. The question is whether the government should redirect funding away from fungible dollars for institutions that do research, and toward actual research costs.

As a recovering academic, I can tell you that the high proportion of “indirect” funding (in grant lingo) distorts incentives at universities. University administration makes successful grant-writing a major part of tenure and promotion decisions for faculty members. They shift resources away from departments that don’t get big grants toward ones that do. After all, the money that the chemistry department brings in on federal grants doesn’t just fund the chemistry department; it funds the new student center and the fancy new dorm and the study-abroad program and a fleet of deans and deanlets to manage it all.

Will cutting “indirect” hurt basic research at all? It will certainly hurt some of the institutions that do research, such as large research universities and research hospitals. But the policy change has both income effects and substitution effects. By shrinking the incomes of institutions that support research, the change could indeed reduce their ability to do research. But it also gives those institutions an incentive to switch from non-research activities toward research activities. As a result, we might end up with more research, not less.

If they hold and spread, cuts to federal indirect funding ratios should cause universities to prioritize undergraduate teaching more for hiring and promotion, and more basic research will take place in standalone research institutions staffed by scientists who do nothing but research. 

That bifurcation between teaching and research could be good for both. Science has progressed to the point that the vast majority of undergraduates simply cannot understand research at the frontier of scientific progress, even in their major fields of study. It doesn’t make much sense for world-class scientists to spend a lot of time in the classroom correcting the elementary errors of eighteen-year-olds. And they often do a bad job of that! Why not leave teaching to scholars who may not be at the frontier of scientific progress, but who can enliven the subject for those encountering it for the first time?

Let’s not forget, too, that the NIH has been shifting away from basic to applied research. Over time, the NIH has funded a greater proportion of applied research projects and offered applied research projects a greater share of funding. The majority of NIH funding now goes to applied, not basic research projects. 

But the nonexcludability rationale for basic research doesn’t carry over to applied research. Intellectual property law provides ample protection for applied technology innovators to make a profit from their publicly funded research. If the policy change cuts government funding for applied research, that cut likely benefits the American taxpayer.

We don’t really know what the right proportion of indirect funding for basic research is. It’s possible that private foundations keep their ratios so low because they know recipients get plenty of indirect funding from government grants. So cutting government indirect ratios could cause private foundations to raise theirs. A process of discovery in the marketplace could lead to a more efficient allocation of research grant dollars.

The DOGE-inspired move to cut NIH indirect expense funding has produced a lot of wailing and gnashing of teeth, but that reaction seems disproportionate to the real effects of the move. The overall amount of basic research that the American economy produces, and the benefits it provides to American industry, could just as easily grow as shrink.

*This article has been amended to more accurately reflect the percentage of indirect costs in total grants.

Jason Sorens, Ph.D., is Senior Research Fellow at AIER. He is also Principal Investigator on the New Hampshire Zoning Atlas. Jason was formerly the director of the Center for Ethics in Society at Saint Anselm College. He has researched and written more than 20 peer‐​reviewed journal articles, a book for McGill‐​Queens University Press titled Secessionism, and a biennially revised book for the Cato Institute, Freedom in the 50 States (with William Ruger).

His research is focused on housing policy and land-use regulation, U.S. state politics, fiscal federalism, and movements for regional autonomy and independence around the world. He has taught at Yale, Dartmouth, and the University at Buffalo and twice won awards for best teaching in his department. 

https://thedailyeconomy.org/article/cuts-to-indirect-federal-grants-could-change-research-for-the-better/

Supreme Court Is Poised to Restore the President’s Executive Power

 Article II of the Constitution begins with a simple declarative sentence: “The executive power shall be vested in a president of the United States of America.” Those 15 words are at the heart of a key battle in the early days of the second Trump administration—and will likely be the basis for consolidating power in one individual over what has become the most important branch of government.

In his first month in office, President Trump has removed many officials, both high-ranking and middle-managerial, hoping to streamline government and wrest control of the permanent bureaucracy. Many of the dispatched employees have contested their removal in court. The dispute is partially about civil-service rules and, more consequentially, about the president’s ability to remove principal officers of so-called independent agencies, which themselves are a contradiction in constitutional terms.

These employees argue that their firings were unconstitutional because of a 90-year-old Supreme Court decision that protects heads of independent agencies (but not cabinet departments) from without-cause removal. That 1935 precedent, Humphrey’s Executor v. United States, held that agencies wielding “quasi-judicial and quasi-legislative” power can only get fired for incompetence or malfeasance, not mere presidential agenda-setting. In 1988, the justices extended Humphrey’s Executor to nearly all federal officials in Morrison v. Olson, over a fierce solo dissent by Justice Antonin Scalia, who argued that the presidential removal power was essential to checking government abuses and ensuring political accountability. Those decisions fueled the rise of the modern administrative state.

Over time, however, Scalia’s Olson dissent has increasingly been vindicated. Congress allowed the independent-counsel statute to expire in 1999. And in the 2020 case Seila Law v. Consumer Finance Protection Bureau, the Supreme Court found that the Morrison holding applied only to inferior officers—meaning the president could remove most, if not all, department heads. The Court, in a string of cases over the past 15 years, has read Humphrey’s Executor narrowly, refusing to let Congress restrict the president’s personnel power.

Along the way, the Court majority embraced the heart of the 1926 precedent that Humphrey’s abrogated, Myers v. United States. In that case, Chief Justice Wiliam Howard Taft wrote that the president’s removal authority was not only implicit in constitutional structure, but flowed from the text of Article II, and was the reading understood and approved by the First Congress. Consequently, Congress can’t limit the president’s ability to remove executive-branch officers that he or his predecessor had appointed with the Senate’s advice and consent.

That principle is why Acting Solicitor General Sarah Harris, the government’s head lawyer before the Supreme Court, notified the Senate earlier this month that “the Department of Justice has determined that certain for-cause removal provisions that apply to members of multi-member regulatory commissions are unconstitutional and the Department will no longer defend their constitutionality.” Harris’s letter represents the culmination of decades of work by the conservative legal movement to restore unitary executive power—which, contrary to media alarmism, has nothing to do with the scope of executive power and everything to do with how it is controlled. Because the Constitution vests the president, alone, with executive power, it is the president, alone, who wields power over all executive agencies.

A majority on the Court now seems set to return to that view. As Chief Justice John Roberts explained in Seila Law, Article II authority “generally includes the ability to remove executive officials,” a power that is necessary to ensure the accountable and effective execution of federal policy. (Indeed, another part of Article II requires that that president “take care that the laws be faithfully executed.”) Roberts warned that, without the power to remove executive-branch officers, “the President could not be held fully accountable for discharging his own responsibilities; the buck would stop somewhere else.”

The Left is engaging in a fool’s errand by challenging Trump less on the constitutional substance of his policies—where he is on much surer ground than in his first term—but on his ability to lead the executive branch. Within a year or two, administration lawyers will enjoy having been thrown into this particular briar patch.

Ilya Shapiro is the director of constitutional studies at the Manhattan Institute and author of the new book Lawless: The Miseducation of America’s Elites. He also writes the Shapiro’s Gavel newsletter on Substack.

https://www.city-journal.org/article/supreme-court-trump-firings-executive-branch-power

'Lutnick suggests possible compromise on Trump tariffs'

U.S. stock futures rose Tuesday night after all three major averages suffered sharp losses for a second session.

Futures tied to the Dow Jones Industrial Average rose 273 points, or 0.6%. S&P 500 futures and Nasdaq 100 futures added 0.7% and 0.8%, respectively.

The blue-chip Dow tumbled 670.25 points, or 1.55%, to end Tuesday’s regular trading session. The S&P 500 dropped 1.22%, and the Nasdaq Composite shed 0.35%. The tech-heavy Nasdaq had dipped more than 2% at its lowest point and came within striking distance of correction territory, a term that refers to an index falling 10% from a recent peak.

U.S. stocks slid for their second day in a row after President Donald Trump’s new 25% tariffs on Canada and Mexico officially took effect on Tuesday. In response, Canada, Mexico and China — with China hit by an additional 10% duty — have prepared retaliatory measures.

However, Commerce Secretary Howard Lutnick said on “Fox Business” on Tuesday afternoon that the U.S. might meet Canada and Mexico somewhere “in the middle” to “work something out” on tariffs.


https://www.cnbc.com/2025/03/04/stock-market-today-live-updates.html

'Hong Kong-based company to sell Panama Canal ports'

 A Hong Kong-based company has agreed to sell most of its stake in two key ports on the Panama Canal to a group led by US investment company BlackRock.

The sale comes after weeks of complaining by President Donald Trump that the canal is under Chinese control and that the US should take control of the major shipping route.

Through a subsidiary, CK Hutchison Holding operates ports at the Atlantic Ocean and Pacific Ocean entrances to the canal.

It said Tuesday that it would sell its interests as part of a deal worth $22.8bn (£17.8bn).

CK Hutchison is not owned by the Chinese government but its base in Hong Kong means it operates under Chinese financial laws. It has operated the ports since 1997.

The deal includes a total of 43 ports in 23 countries around the world, including the two canal terminals. It will require approval by the Panamanian government.

The 51-mile (82km) Panama Canal cuts across the central American nation and is the main link between the Atlantic and Pacific oceans.

Up to 14,000 ships travel through it each year, including container ships carrying cars, natural gas and other goods, and military vessels.

It was built in the early 1900s. The US maintained control over the canal zone until 1977, when treaties gradually ceded the land back to Panama.

After a period of joint control, Panama took sole control in 1999.

Trump has made several arguments for retaking control of the canal and the surrounding area. He argued that Chinese influence is a national security threat, that the US investment in the initial building of the canal justifies taking back control, and that US ships are charged too much for using the waterway.

In a visit to Panama in February, US Secretary of State Marco Rubio demanded that the country make "immediate changes" to what he calls the "influence and control" of China over the canal.

Panama rejected the US government claims and President Jose Raul Mulino has said the canal "is and will remain" in the central American country's hands.

In a statement announcing the business deal, Frank Sixt, co-managing director of CK Hutchison, said: "I would like to stress that the transaction is purely commercial in nature and wholly unrelated to recent political news reports concerning the Panama Ports."

BlackRock is one of the world's largest asset management companies. The group buying the ports also includes Terminal Investment Limited, a Swiss company.

https://www.bbc.com/news/articles/clyzlk259g2o

KUDLOW: Trump's message to Congress — unleash prosperity

 Here’s hoping President Donald Trump will deliver a rousing speech tonight showing how he intends to unleash prosperity in America.

I’m hoping for a growthier speech, with plenty of tax cuts.

The President is riding high in popularity, with nearly 80-percent favorable ratings on things like the border, deportations, eliminating waste, fraud, and corruption, disempowering the entrenched bureaucracy, rolling back onerous regulations, unlocking new energy production, and reciprocal fair trade.

Put the whole package together, and you have a major booster shot to economic growth, while inflationary pressures and costs come down.

Right now, the Biden legacy is showing up in weaker and weaker numbers. Housing is soft, business investment is down, manufacturing is slumping, even consumer spending coming in weak. The Bidens have not only left Mr. Trump with a slump in the economy, but $2 trillion deficits as far as the eye can see, and a massive expansion of federal debt.

video

Commerce Secretary Howard Lutnick on Trump's commitment to fair, reciprocal trade

But every time the stock market hiccups, liberals try to blame tariffs.

Well, the fact remains that Mr. Trump is trying to break through an unfair trading system that has penalized American companies, with his brand of reciprocal and fair trade reform.

The idea that tariffs are inflationary is poorly thought out.

Vast government spending and money-printing cause sustained inflation. Mr. Trump is working against that.

In the short run, trade actions might cause one-time temporary, minor price increases, but not long-run inflation.

President Trump is doing his best to reform the broken world trading system and defend American interests.

Over time, by the way, reciprocal trade could bring tariffs down, not up. And his reciprocal trading policy could bring large-scale supply-side benefits to the American economy.

I think most importantly for this evening’s speech, though, I’d like to see President Trump forcefully ask Congress to pass his tax cuts and deregulation budget reconciliation bill, and make the tax cuts permanent — including Trump 2.0 cuts like tax-free tips and overtime and relief for seniors.

Use the appropriate baseline scorecard, accurately reflecting that the 2017 Trump tax cuts produced huge revenues.

And hopefully Mr. Trump will forcefully point out that people who vote against his tax cut plan will be voting in favor of an at least $4 trillion tax hike that will absolutely decimate whatever is left of the economy he inherited from Joe Biden.

Let’s pass one, big beautiful bill by Memorial Day, so we can have one, big, beautiful blue-collar boom that will fatten wallets and unleash prosperity for all Americans.

https://www.foxbusiness.com/politics/larry-kudlow-trumps-message-congress-unleash-prosperity

Trump Poised To Deliver Justice For Ashli Babbitt's Family

 by Luis Cornelio via Headline USA,

The federal government, now led by President Donald Trump, may finally compensate the grieving family of Ashli Babbitt - a veteran and MAGA activist who was fatally shot inside the U.S. Capitol on Jan. 6, 2021.

Judicial Watch, a conservative non-profit, sued the federal government for $30 million in wrongful death damages on behalf of Babbitt’s estate and husband, Aaron. 

The Biden administration had fought tooth and nail to dismiss the case until President Donald Trump took office in January.

A document filed by federal attorneys and Judicial Watch on Feb. 25 stated that the “parties have agreed to work in good faith to narrow or resolve issues in this case.” 

In an interview with the Washington Examiner, Judicial Watch President Tom Fitton did not delve into the case’s details but said, “All we want is justice and we hope the Justice Department under President Trump would share that goal ultimately.” 

Fitton’s comments and the federal government’s filing mark the first time since the lawsuit was filed that the federal government has suggested that a settlement is under way. 

The sudden shift comes on the heels of Trump’s sweeping pardons and commutations for those prosecuted in the Jan. 6 protest. 

While Democrats have described that day as a dangerous insurrection and even a terrorist attack, Babbitt was the only person killed. She was seen climbing a door with cracked glass leading to the Speaker’s lobby before being fatally shot by police officer Michael Byrd. 

Other individuals who died that day did so of natural causes. Kevin Greeson and Benjamin Phillips passed due to cardiovascular disease, while Rosanne Boyland, another Trump supporter, died due to an accidental overdose. Capitol Police officer Brian Sicknick, meanwhile, suffered stroke and died eight hours after the protest. 

Shortly after Biden took office, his DOJ cracked down on anyone who entered the U.S. Capitol to protest. Biden’s heavy-handed enforcement prompted the Supreme Court to intervene, ruling that the DOJ had illegally used a law to prosecute some of the Jan. 6 defendants. 

Trump undid Biden’s mishaps by pardoning those who were prosecuted by the Biden administration. The pardons occurred just days after Biden commuted the death sentences of all death-row inmates. 

Biden also became the first president in U.S. history to pardon his siblings and son, shielding them from accountability for crimes committed over an 11-year period. 

https://www.zerohedge.com/political/trump-poised-deliver-justice-ashli-babbitts-family