Despite the Pelosi standoff, the economy surges despite its detractors, plus extended thoughts about Russia's violation of the IMF treaty... and MORE!
American Opportunity
A/O Global Intelligence Weekly: American Economy Surges; Pompeo Charts New Course

Earlier, the government issued its monthly jobs report.  Commentators on the far left were practically beside themselves, expecting and hoping for a jobs report that showed the American economy was slowing to a crawl thanks to a government shutdown.  The expectation was that the job growth number would be in the 100,000 range, with the twin boogeymen of a government shutdown over appropriations and Trump's demand for a muscular border security schematic along our southern border being the culprits for disaster.

The result?  Not only was the jobs report far beyond expectations at 304,000 new American jobs, but the impact of the standoff between Nancy Pelosi and the president barely registered on the American economy -- about 0.02% GDP.  

This is a very robust number, which shows the continuing expansion of the United States economy and the overwhelming success of the Trump tax reform policy, much of which are a substantial portion of the American Opportunity Growth Code.  Just imagine what a full implementation would look like?!

Of course, no one in their right mind wants or desires a federal government shutdown or standoff.  Yet the fact remains that our U.S. Constitution forces compromise and consensus on the whole.  Congress funds the government through appropriations; such legislation must satisfy the U.S. House of Representatives, the U.S. Senate, and the President.  Yet the U.S. House under Nancy Pelosi and her outright refusal to even consider “one dime” for a border wall makes that constitutional consensus impossible.

But did the disagreement negatively affect the U.S. economy?  The answer at this rate is decidedly a no, but entirely based upon the strength of Trump's economic policy to date and certainly not due to partisan intransigence.  

A recent report gleefully suggested the Trump tax cuts had not improved the economy, a demonstrable falsehood after the new jobs report.  One is tempted to recall that during the previous administration, economic growth was practically zero and actually saw contractions once one includes the rate of inflation and population growth. 

Many reports said the American economy has never truly recovered from the Great Recession of 2008. If one looks at the national economy, this is by and large true thanks to the previous administration's "slow growth" policy that intentionally kept the U.S. economy stagnate while the world -- most notably, China -- accelerated.  The extremism was so bad, many economists on the left even complained that wage growth was bad in order to make the case for increasing the minimum wage!

Yet the Trump tax cuts sent a clear signal that the United States economy was changing, and would from now on be committed to a growth of the economy not just as a matter of economic policy but one of national security.  This creates confidence not just in the business world as we restore confidence in an American future, but spurs increased capital investment, creates more liquidity in American markets, and puts the American worker back to on the job to provide better lives and better futures for themselves and their families.

The net result of the last two years?  Increased American productivity, more job creation, more people looking for work, and a better economy for everyone -- everything the previous administration said was impossible.  Even labor participation rates are a six year high.

Alternatively, leftist observers might have chosen to stick a low job creation number as the result of President Trump's foreign policy, specifically the announced withdrawal of the United States from the Intermediate Nuclear Forces Treaty (INF) after repeated instances of violations from the Russian Federation with the development of the INF-range 9M729 cruise missile, after having flight tested, deployed, and on January 23rd put the weapon on display in a Moscow military theme park...

More after the jump. . . 

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As a result of this new Russian weapons platform that clearly violates the INF Treaty, Secretary of State Pompeo has finally announced that the United States was giving the required six month notice that we will be withdrawing from the INF treaty.

This is no moment for celebration, as Russian intransigence on this front creates a more dangerous and unstable world that draws harder lines in Europe and increases the likelihood of confrontation in Eastern Europe.

Among NATO allies, there is broad agreement that Russia is in violation of the treaty by deploying the new 9M723 cruise missile platform. President Trump and Secretary Pompeo have warned for weeks that the U.S. could not stay bound into treaty where only one side observed both the spirit and letter of the agreement.  

To offer some idea of how challenging the end of the INF treaty truly is, one must remember that it was negotiated and signed by former Soviet President Mikhail Gorbachev and President Ronald Reagan in an effort to limit short and intermediate range nuclear missiles on the European continent after the Soviets very nearly initiated nuclear holocaust in reaction to what NATO saw as a benign military exercise (Able Archer) in 1983.  

When the treaty was signed in December 1987, Gorbachev had placed Russia on the road to peace and progress.  More than remove a pointless threat against Europe, the Soviets would be able to concentrate more firmly on economic development, thus Russia would concentrate on better conditions for the Russian people, instead of a pointless threat to the West.

Russian President Vladimir Putin has a different agenda.  His geopolitical designs and agenda threatens the United States and our allies every day.  If the West needed any clearer evidence of Putin's designs in Eastern Europe, his attempt to annex the Crimea is the most blatant violation of the post-Cold War peace that made the INF possible in the first place.

Some in America and in Europe continue along narrow partisan lines to accuse the president of disregarding our allies.  Yet President Trump's firm and consistent policy of strengthening NATO against Russian agitation demonstrates a reversal of the previous administration's policies that saw America in retreat and our enemies grow in strength.  Russian violations of the INF treaty only follow Russian violations of Ukrainian territorial integrity -- and directly threaten our allies in Europe

Make no mistake, these Russian intermediate range cruise missiles have four targets: Poland, Lithuania, Latvia and Estonia.  Such missiles make it much more difficult for those countries to defend themselves in the face of a limited theater engagement.  We should be hopeful that our withdrawal from the INF Treaty sends a clear message to Moscow, one states clearly that if the Russian Federation intends on changing the rules of the game in Eastern Europe, then the West will put all options on the table to reinforce political realities on the ground, whether that is in Poland, the Baltics or Ukraine.   

The message sent by Washington is at this rate crystal clear.  The United States will freely apply deterrence to prevent Russia from trying to change the map of Europe by force, intimidation and invasion.  Moscow can either honor its agreements or choose bellicosity, but it cannot have both if it is to be a meaningful partner alongside the European Union and the United States.

On this point, Secretary Pompeo’s speech in Brussels, Belgium on December 4, 2018 was remarkably clear.  While Pompeo urged international organizations to re-evaluate their purpose and role in an increasingly sophisticated and dangerous world, this sentiment was by one writer in particular attached to the Council on Foreign Relations as “ridiculous.”  Foreign Policy magazine said the speech was “tone deaf and arrogant.” Politico said the speech was “a remarkably undiplomatic speech by the top American diplomat.”  

I firmly and emphatically disagree with such criticism.  It is both narrow and short-sighted, and designed to effect domestic political outcomes rather than directed at geopolitical realities being crafted outside of Washington.  

Pompeo's speech did nothing incredible, but rather simply stated that we should always evaluate the old ways and institutions to make sure they still achieve their purpose.  In fact in the speech, Secretary Pompeo described NATO as “indispensable”. But accepting the value of international organizations to further the freedom and well-being of its member nations does not mean that international organization are somehow mystically free from review. 

To bring such conditions into sharp relief, the United Kingdom is doing precisely this right now in its debate over withdrawal from the European Union; the United States performed a similar review with NAFTA; NATO allies have increased military spending by $50 billion since 2015 -- the equivalent of tacking on a nation such as Britain or France to the alliance.  

I have reviewed the speech and would urge our readers to find the speech on YouTube and actually listen to Pompeo's outstanding speech in Brussels.  Its takes only 19 minutes, but please do not rely on narrow partisan commentary to assess his remarks and the policy positions they represent.

The American commitment to the liberal international order is absolutely unshakable.  The withdrawal from the INF Treaty merely confirms that today's status quo has become unacceptably dangerous to our European allies.  Agreements bind all actors to their wisdom; allowing their ossification only serves the enemies of peace and prosperity.

Some news and articles we recommend for information and discussion purposes, none of which necessarily represent the position of A/O:

As always, American Opportunity is always looking for new resources and topics we can address in detail.  Please feel free to stay in contact! 


Jim Gilmore
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