Donald Trump’s COVID comeuppance

WASHINGON, DC — The US COVID-19 crisis fits the pattern of President Donald Trump’s career with its serial bankruptcies. Trump has badly mishandled the crisis, but while the United States will be living with the adverse consequences for many years, Trump will walk away, perhaps as soon as this week, blaming everyone but himself.

The pandemic did not turn Trump into a bad decision-maker unwilling to learn and take responsibility. But it did fully expose all his worst tendencies, including his poor judgment, inability to think about anyone but himself, and eagerness to shift the cost of his mistakes onto others. This time, the human and economic losses are borne by all of us, and they are enormous.

Trump was born rich, and much of the money he made on his own was the tainted fruit of “tax dodges in the 1990s”, according to a New York Times assessment of his tax records. His career has been a train of default and failure: Atlantic City casinos, Trump University, Trump Mortgage, Trump Steaks, Trump Magazine, Trump: The Game, and so on. The available evidence suggests that by the early 2000s, Trump had little remaining net worth.

Most likely, this is the reason that Trump has never released his tax returns. He was not very successful as a businessman, except as a serial duper of creditors and other investors.

As president, Trump promised to bring back manufacturing jobs; in fact, the US has actually lost more than 200,000 jobs in this important sector since the start of his presidency. Trump claims that he boosted the economy; in fact, the US has experienced the greatest economic disaster since the Great Depression.

Trump of course blames COVID-19 and claims that its impact is not his fault. But the primary economic and foreign policy responsibility of any president is to safeguard against crisis and potential collapse, problems that are not rare in the modern world. Effective crisis management is about understanding what is going on, considering all relevant expertise, making sound decisions, and updating those decisions as needed. Trump has failed on all of these dimensions.

Trump did apparently know the nature and potential impact of COVID-19 early on. According to what he told Bob Woodward, Trump was well briefed in January. Yet at that stage he did nothing to warn the public or help prepare federal, state, and local government agencies.

The US has deep scientific and medical talent, but Trump failed to marshal it. In Woodward’s well-documented assessment, “Trump never did seem willing to fully mobilise the federal government and continually seemed to push problems off on the states.”

And when Trump did act, it was to cause confusion and chaos. The White House could not organise the emergency import of personal protective equipment (PPE) such as masks and gowns, until one of my MIT colleagues became involved. Trump famously told governors to find their own supply of ventilators. And the guidance issued by the Centers for Disease Control and Prevention has been consistently subject to damaging political meddling.

The pressing problem of nursing homes, vulnerable and unprotected residents and staff, was explained in detail to the White House by mid-March, by the COVID-19 Policy Alliance (which I co-founded) among others. The response? Do nothing: no additional PPE, no money for COVID-19 testing, and no money to pay additional workers replacing those who became sick or were forced into quarantine. Tens of thousands of people died unnecessarily, separated from their families. Thirty-eight per cent of all pandemic-related deaths in the US have been in nursing homes.

The only consistent Trump policy was, and is, to blame others, in fact, to blame everyone imaginable, and never to take responsibility. In the Trump narrative, all his decisions are perfect.

Refusing to act decisively on COVID-19, using all the resources at the disposal of the federal government, was risky, very risky. But Trump likes this kind of risk, because he believes, based on long experience, that he can shift all losses onto others. And America certainly had big losses in terms of output, employment and lives.

What consequences of this mismanagement await Trump? One scenario is that he will sulk away this week, promoting an angry and false narrative that continues to polarise the public. He may continue to rattle around the world, attempting to gull new suckers into investment schemes where he gets the upside and someone else owns the downside when things go wrong.

Alternatively, COVID-19 ends his business career. Most of Trump’s assets are commercial real estate, the market value of which is now greatly diminished. Over $900 million of Trump’s debt reportedly comes due in the next four years. If Trump is no longer president, his creditors will have no reason to be patient when the Trump Organisation can no longer make its payments.

Simon Johnson, a former chief economist at the International Monetary Fund, is a professor at MIT's Sloan School of Management and a co-chair of the COVID-19 Policy Alliance. He supports the Biden-Harris presidential campaign. Copyright: Project Syndicate, 2020. www.project-syndicate.org