Biden Risks Sharing Inglorious Fate of Boris Johnson, Kudlow Cautions

Brexit offered Prime Minister Boris Johnson unlimited potential to grow Britain’s economy, Sun columnist Lawrence Kudlow said at a parley hosted by the Sun’s publisher, Dovid Efune. That opportunity was largely forfeited, he went on to lament. The director of President Trump’s National Economic Council recalled urging the young British premier, in the days after his 2019 electoral victory, to slash tax rates and eradicate European Union regulations in an overhaul he called “Magna Carta 2.0.” Instead, Mr. Kudlow recalled, Mr. Johnson took a different course. He raised taxes, embraced social spending, and moved the government to an interventionist policy on climate change — alienating his Tory constituency and leading to his own resignation last week.The lesson for President Biden, according to Mr. Kudlow, is a stark one. An initial electoral victory can quickly lead to political catastrophe if the president fails to adequately respond to security threats abroad and looming economic calamity at home.Mr. Kudlow told this cautionary tale in a discussion with editors and Founder members of the Sun. He explained that the crisis of confidence besetting Mr. Biden stems from his own inability to address a war in Ukraine, the exercise of Communist Chinese power, and record-high inflation. Mr. Biden’s approach to the Ukraine war has been “a dollar short and a day late, every step of the way,” Mr. Kudlow said. America imposed economic sanctions on Russia only after the Ukraine invasion, eliminating the opportunity for negotiation while the U.S. had leverage to dent the Russian economy, and potentially deter the war altogether. Once the government and private financiers yielded their purchases of Russian oil, production only temporarily decreased as newer and bigger customers more than compensated for losses in American financing. The ruble is now the strongest European currency, surging while the pound sterling, the euro, and the yen all plunge. “China and India are essentially financing Putin’s war machine,” Mr. Kudlow said.Yet America, in turn, Mr. Kudlow warned, might be financing Communist China. Mr. Biden is considering lifting tariffs on Chinese goods, a move which would only bolster their economic prowess and therefore prolong the war in Ukraine, Mr. Kudlow explained. “I’m a free trader, except for China.”Additionally, Mr. Kudlow noted that the administration has not made progress in resisting China’s intellectual property theft and stealing of American user data from companies like TikTok, “an instrumentality of the Chinese Communist Party,” Mr. Kudlow said. “The one thing that America has over the rest of the world,” Mr. Kudlow added, “is the most vibrant, innovative, advanced technology sector.”Amid tectonic shifts in the foreign landscape, Mr. Kudlow said, Mr. Biden has failed to adjust adequately his domestic policy in response to these challenges. While consumers suffer the effects of inflation, the White House has limited oil production and therefore raised the price at the pump. Mr. Biden’s response to inflation has been to “spend and print, spend and print,” Mr. Kudlow said. “Keynes would be rolling over in his grave,” he joked, in reference to the English economist whose advocacy of government spending reigned supreme in the middle of the last century. Mr. Kudlow’s long experience in government informed his read of the present. He worked for President Reagan’s budget office four decades ago, and led economic policy making under President Trump. He has hewed all the while to supply-side policies for growth and a quest for what he calls “sound, reliable, honest money.”At the Sun event, Mr. Kudlow, describing himself as “a fact guy” and turning from critique to counsel, offered a simple program to limit the effects of an imminent recession. The President should freeze federal spending, not increase it by trillions more. He should make permanent the tax cuts enacted under President Trump, lest some expire by the end of this year, and deregulate the business and energy sectors.“Good politicians reset. They shouldn’t be afraid of that,” Mr. Kudlow said. Known as a man with few enemies, Mr. Kudlow said he does not personalize politics and policy. This clear eyed watcher of the markets brings to mind an axiom of George Orwell: “In a time of deceit, telling the truth is a revolutionary act.”

Biden Risks Sharing Inglorious Fate of Boris Johnson, Kudlow Cautions

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