Trump adopts familiar mantra on possible recession: fake news

President TrumpDonald John TrumpGOP divided over impeachment trial strategy Official testifies that Bolton had 'one-on-one meeting' with Trump over Ukraine aid Louisiana governor wins re-election MORE and his advisers are adopting a familiar mantra when it comes to mounting concerns about the economy: It’s all fake news.

Trump has dismissed concerns over a possible recession and accused the press of manufacturing a crisis and “doing everything they can to crash the economy” so he doesn’t win in 2020.

“I don’t think we're having a recession. We're doing tremendously well. Our consumers are rich. I gave a tremendous tax cut, and they're loaded up with money,” Trump told reporters Sunday evening before returning to the White House from a 10-day stay at his New Jersey golf club.

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If the economy does slow, he says it will be because he had to “take on China and some other countries.” He then accused countries in the European Union of treating the United States “very badly.” 

The message has been parroted by Trump’s top advisers.

“I think we're in pretty good shape, and I want to just say, you know, we should not be afraid of optimism. I don't know what it is. Everybody wants to talk about pessimism, recession,” White House economic adviser Larry KudlowLawrence (Larry) Alan KudlowMORE told Fox News earlier Sunday. “There's no recession on the horizon.” 

Vice President Pence insisted in a speech Monday to the Detroit Economic Club that the economic outlook remained strong “despite the irresponsible rhetoric of many in the mainstream media.”

And White House counselor Kellyanne ConwayKellyanne Elizabeth ConwayNBC signs Mueller 'pit bull' prosecutor Andrew Weissman as legal analyst George Conway and Trump Jr. trade personal insults during impeachment hearing Conway: Trump reacted 'pretty well' to impeachment hearing because 'there was nothing new' MORE told reporters that “the fundamentals of the economy are very strong.”

She also said the media seemed interested in covering the economy only if it could be cast as bad news for Trump.

“It’s nice to see the media finally cover the Trump economy. You seem to cover it only when you can use the Sesame Street word of the day: recession,” she said. “The fact is, the fundamentals of our economy are very strong, and you know it.”

There are signs the White House is addressing the possibility of a downturn.

Trump phoned the chief executives of major banks last week seeking feedback as the stock market tumbled. Kudlow will hold a briefing for business leaders on Tuesday, though a White House spokesman insisted the call has been “long-planned.”

Trump on Monday urged the Federal Reserve to cut rates by at least 1 percent, a move that the central bank would typically undertake to counteract a slowing economy.

And The Washington Post reported that the White House is considering pursuing a temporary payroll tax cut to provide additional stimulus, though the concept would require Congressional approval.

An economic downturn would be seen as a major threat to the president’s reelection prospects, undercutting his signature argument for reelection.

The criticism of the media comes in part because of irritation that the media hasn’t covered the economy fairly, Sean SpicerSean Michael SpicerThe Hill's Morning Report - Witness transcripts plow ground for public impeachment testimony Sean Spicer eliminated from 'Dancing with the Stars' Trump Jr.: How can Dems beat Trump if they can't boot Sean Spicer from DWTS? MORE, the former White House press secretary under Trump, said in an interview.

“When the economy was strengthening and improving based on actual job numbers and growth, there was scant coverage,” he said. “When speculation about it turning down arises, there is a disproportionate amount of coverage just on the speculation on its own.”

“I think he is trying to get ahead of the curve,” Spicer continued. “If something goes wrong, the question is if something were to take a downturn, I think he’s trying to make sure well ahead of that he’s trying to make his case.” 

The White House has reasons to fear a recession.

Trump has struggled to close a China trade deal and last week agreed to delay certain tariffs on Beijing that might have boomeranged on U.S. consumers. The turnaround was seen as a sign of Trump’s own uncertainty about the economy. A key measurement in the bond markets known as a yield curve inversion also alarmed economists who view it as a reliable indicator of a future recession.

Trump has projected confidence while blaming not only the media but also Democrats and the Federal Reserve. Trump on Monday fumed at Federal Reserve Chairman Jerome Powell for having a “horrendous lack of vision” and suggested the central bank had held the economy back. 

At a New Hampshire rally last week, Trump claimed voters had no choice but to vote for him because “your 401(k), everything is going to be down the tubes” if a Democrat is elected to the White House. 

Trump’s advisers argue that the economy is strong and shows little sign of faltering, pointing to the low unemployment rate, strong jobs numbers and high consumer confidence as more reliable indicators.

They also say that the trade negotiations with China are going well and express optimism that Beijing will make a deal. And they’ve downplayed the impact U.S. tariffs on Chinese goods will have on American consumers, even as research has suggested Americans pay the brunt of the tariffs targeting Beijing. 

The media is always a popular target for Trump, who has lambasted press coverage of everything from special counsel Robert MuellerRobert (Bob) Swan MuellerSpeier says impeachment inquiry shows 'very strong case of bribery' by Trump Gowdy: I '100 percent' still believe public congressional hearings are 'a circus' Comey: Mueller 'didn't succeed in his mission because there was inadequate transparency' MORE’s investigation to his poll numbers to crowd size at his rallies. Trump often singles out individual reporters and outlets by name.

Republican strategist Colin Reed said Trump is using the familiar tactic to rally his base as the election campaign gets underway, arguing it has been effective and noting that Democrats have also taken a page out of Trump’s playbook. 

“Whether you agree with it or not, it’s an effective political strategy to rally your base,” Reed said. “Trump is going to stick with what brought him to the dance and making the media one of his foils is a big part of that argument.” 

Economists have cautioned against assumptions about a looming recession but have stressed that the risks are real and have been exacerbated by Trump’s trade war with China.

“It feels like we’re on the road to recession. The trade war’s fingerprints are all over this,” said Mark Zandi, the chief economist at Moody’s Analytics.

He called it “beyond the pale” for Trump and his allies to pin blame on the Federal Reserve, arguing that the central bank has been forced to react to the administration’s at times unpredictable fiscal and trade policies.

Zandi said the trade war has hurt the manufacturing and transportation sectors and has created uncertainty for business leaders who may be hesitant to act without knowing whether Trump is implementing additional tariffs.

Trump could calm talk of a downturn by announcing he has a deal with China, he said, but noted it will get increasingly difficult to pull that off with each passing week.

“There’s a thin line between an expanding economy and a recession,” Zandi said, noting a downturn can be triggered if consumer confidence falters. “We’re pretty close to that tipping point.”