Viewpoint: Why Oligarchs Want a Recession
labornotes.org
A recession is looming. Trump himself recently affirmed that his economic plans would induce a recession in the near term. He remarked when asked as much by an interviewer, “There is a period of transition because what we’re doing is very big.” And yet, before Trump crashed the stock market last week with his global tariff regime, America’s CEOs had the highest confidence in the U.S. economy that they’ve had in three years, according to a nationwide survey in the early weeks of the Trump administration. And Trump has simply been carrying out the promises he’s long made.

A recession is looming. Trump himself recently affirmed that his economic plans would induce a recession in the near term. He remarked when asked as much by an interviewer, “There is a period of transition because what we’re doing is very big.”

And yet, before Trump crashed the stock market last week with his global tariff regime, America’s CEOs had the highest confidence in the U.S. economy that they’ve had in three years, according to a nationwide survey in the early weeks of the Trump administration.

And Trump has simply been carrying out the promises he’s long made. His global tariff plan, for example, was outlined in 2023. Why, then, have C-suiters remained quiet cheerleaders for Trump while he implemented an economic vision that no sane person would endorse?

Because lavish tax cuts, deregulation, and an environment friendly to union-busting are just as valuable to most CEOs as a growing economy. What they lose in the stock market, they will more than make up in surplus labor, a fire sale on distressed assets, and Trump’s promise to totally eliminate the capital gains tax.

The rich are not a monolith, but the financiers and tech oligarchs (very rich businesspeople with political power) closest to the Trump administration accumulate wealth not necessarily by producing things or investing in societal infrastructure, but rather through a mix of speculation (gambling), amassing predatory private equity, and corporate welfare from the government.

The MAGA-aligned capitalists no longer require a healthy national economy to build their wealth. The working class still does. From their perspective, an economic downturn will punish labor. Win-win, for them. So now the interests of America’s ruling class are almost entirely contrary to advancing labor’s well-being.

For that reason, it is a mistake to endorse—as United Auto Workers President Shawn Fain recently did—Trump’s regime of global tariffs. Tariffs are a crucial part of a scheme that uses prolonged economic recession to benefit the rich while disciplining labor.