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Affluent Investor | July 27, 2017

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Impeachment Talk is Costing Investors Money

President Trump
(Photo by Michael Vadon) (CC BY-SA) (Resized/Cropped)

Trump impeachment talk is costing investors money: Bowyer

There has been a steady drumbeat of calls for an investigation that the still-never-Trumpers claim could lead to the impeachment of President Donald Trump. Members of the Democratic Party have yielded the drum sticks and members of the mainstream media have been happy to play the part of the instrument which registers and magnifies the noise. As of this writing, 25 members of the House Democratic Caucus have signed onto the idea of a formal investigation.

But when the roles were reversed, and President Clinton was under threat, the media and Democratic politicians were arguing against impeachment. They warned America that removing Clinton would be bad for the financial markets, and place the global economy at risk. CNN Money published an article blaming GOP impeachment efforts for poor market performance. NPR warned about threats to the economy. Democratic members of the House rose to denounce the disruptions caused by impeachment and demanded that Republicans spare America the ‘national agony’ of punishing our President. Clinton supporters pointed to Dow 10,000, a new milestone reflecting capitalism at its best, and said let’s leave well enough alone.

So does the economic effect of impeachment matter only when the president is a Democrat or do the costs of impeaching Republicans count too? I ask this because it’s pretty clear that this effort to remove the president is hurting the economy.

Let’s look at the data:

During this time web searches for the word impeachment spiked up 12-fold and the London odds makers increased the chances that Trump would not finish out his 1st term by 21%.

From then to now roughly 7 weeks have gone by, and the Dow has been flat, going up only 1.5 percent. For a frame of reference, during the comparable  7 weeks after Trump was elected, markets exploded upward 8.3%.

There is little doubt that efforts by the media and the Democratic Party to keep impeachment on the table are hurting market performance, which means it is hurting retirement, pensions and college savings programs. The impeachment crusade is costing you money.

Impeachment hysteria drains effort away from legislative progress. It diminishes the president’s political capital. It distracts from the job of replacing Obamacare, and most importantly, it is slowing down the process of tax reform. The reason that delaying tax reform matters so much is that tax cuts deferred adds up to deferred business activity. If you tell an entrepreneur that next year she’ll be able to deduct equipment purchases in full, she’ll do her best to wait until next year before buying new equipment.  That means pushing tax reform off into the future and likely means slowing our slow economy down even further, perhaps even pushing it into recession.

If there were proof of wrongdoing, then of course, justice counts more than money. A president engaged in criminal activity should be impeached. But we have no evidence of a crime.  So Americans should not be forced to endure continued economic stagnation just so the anti-Trump coalition can score political points.

The bottom line is that if the economic cost of impeachment counts when a Democrat’s in the White House, it should count when it’s a Republican under threat too.

 

Originally published on Fox Business.

Jerry Bowyer is a Forbes contributor, contributing editor of AffluentInvestor.com, and Senior Fellow in Business Economics at The Center for Cultural Leadership.

Jerry has compiled an impressive record as a leading thinker in finance and economics. He worked as an auditor and a tax consultant with Arthur Anderson, as Vice President of the Beechwood Company which is the family office associated with Federated Investors, and has consulted in various privatization efforts for Allegheny County, Pennsylvania. He founded the influential economic think tank, the Allegheny Institute, and has lectured extensively at universities, businesses and civic groups.

Jerry has been a member of three investment committees, among which is Benchmark Financial, Pittsburgh’s largest financial services firm. Jerry had been a regular commentator on Fox Business News and Fox News. He was formerly a CNBC Contributor, has guest-hosted “The Kudlow Report”, and has written for CNBC.com, National Review Online, and The Wall Street Journal, as well as many other publications. He is the author of The Bush Boom and more recently The Free Market Capitalist’s Survival Guide, published by HarperCollins. Jerry is the President of Bowyer Research.

Jerry consulted extensively with the Bush White House on matters pertaining to the recent economic crisis. He has been quoted in the New York Times, The Wall Street Journal, Forbes Magazine, The International Herald Tribune and various local newspapers. He has been a contributing editor of National Review Online, The New York Sun and Townhall Magazine. Jerry has hosted daily radio and TV programs and was one of the founding members of WQED’s On-Q Friday Roundtable. He has guest-hosted the Bill Bennett radio program as well as radio programs in Chicago, Dallas and Los Angeles.

Jerry is the former host of WorldView, a nationally syndicated Sunday-morning political talk show created on the model of Meet The Press. On WorldView, Jerry interviewed distinguished guests including the Vice President, Treasury Secretary, HUD Secretary, former Secretary of Sate Condoleezza Rice, former Presidential Advisor Carl Rove, former Attorney General Edwin Meese and publisher Steve Forbes.

Jerry has taught social ethics at Ottawa Theological Hall, public policy at Saint Vincent’s College, and guest lectured at Carnegie Mellon’s graduate Heinz School of Public Policy. In 1997 Jerry gave the commencement address at his alma mater, Robert Morris University. He was the youngest speaker in the history of the school, and the school received more requests for transcripts of Jerry’s speech than at any other time in its 120-year history.

Jerry lives in Pennsylvania with his wife, Susan, and the youngest five of their seven children.

 

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